Target Reports Strong Q4 Performance, Surpassing Estimates; Issues Cautious Guidance for Q1 and 2025 Fiscal Year

Target Q4 Earnings Highlights:

– Adjusted EPS: $2.98, surpassing the $1.89 YoY and exceeding the estimated $2.40.

– Comparable sales: -4.4% compared to +0.7% YoY, slightly better than the estimated -4.56%.

– Digital sales performance: -0.7% YoY, beating expectations at -5.2%.

– Total sales: $31.47B, reflecting a 1.6% YoY increase, slightly above the estimated $31.35B.

– Gross margin: 25.6%, an improvement from 22.7% YoY and higher than the estimated 25%.

– EBIT: $1.89B, marking a substantial 62% YoY increase. EBITDA: $2.62B, exceeding the estimated $2.23B.

– Customer transactions: -1.7% YoY, and average transaction amount decreased by

-2.8% YoY, deviating from the estimated -0.95%.

– Digital sales share: 21.3% of total sales, up from 20.8% YoY.

– Total stores: 1,956, a modest 0.4% YoY increase, slightly below the estimated 1,966.

– SG&A expense: $6.03B, a 6.2% YoY increase, just below the estimated $6.07B.

– Store comparable sales: -5.4% YoY, falling short of the +1.9% YoY and the estimated -4.93%.

– Stores originated sales: 78.7% YoY, slightly lower than the 79.2% YoY but in line with the estimated 78.7%.

– Operating income: $1.87B, a robust 61% YoY increase, surpassing the estimated $1.53B.

Q1 Guidance:

– Adjusted EPS guidance: $1.70 to $2.10, slightly below the estimated $2.07.

– Comparable sales guidance: -3% to -5%, lower than the estimated -3.36%.

2025 F/Y Guidance:

– Adjusted EPS guidance: $8.60 to $9.60, below the estimated $9.12.

– Comparable sales guidance: 0% to +2%, slightly below the estimated +0.98%.