Target Shares Surge On Record Q2 Results; Lowe’s Q2 Profit Beats View
Minneapolis-based Target Corp. (TGT), on Wednesday, reported second-quarter results that surpassed analysts’ projections. The company’s comparable sales growth was the strongest it has ever reported. Consequently, shares of Target were up 8% in pre-market trade.
Home improvement retailer Lowe’s also delivered a very strong quarterly results, with all merchandising divisions posting comparable sales growth exceeding 20% and all U.S. geographic regions delivering comparable sales growth of at least 30%.
Target Corp. (TGT) reported second quarter adjusted earnings per share of $3.38, up 85.7 percent from $1.82, last year. On average, 24 analysts polled by Thomson Reuters expected the company to report earnings of $1.62 per share. Analysts’ estimates typically exclude special items.
Revenues for the period totaled $23.0 billion, up 24.7 percent from last year. Analysts expected revenue of $20.09 billion for the quarter. Total comparable sales or sales at stores open for at least a year, jumped 24.3 percent, reflecting digital sales growth of 195 percent. Stores fulfilled more than 90 percent of the company’s second quarter sales.
“Our second quarter comparable sales growth of 24.3 percent is the strongest we have ever reported. Our stores were the key to this unprecedented growth, with in-store comp sales growing 10.9 percent and stores enabling more than three-quarters of Target’s digital sales, which rose nearly 200 percent. We also generated outstanding profitability in the quarter, even as we made significant investments in pay and benefits for our team,” said Brian Cornell, CEO of Target Corp.
Separately, Lowe’s Companies, Inc. (LOW) reported second quarter adjusted EPS of $3.75, an increase of 74 percent from $2.15, a year ago. This compares with the average estimate of 26 analysts polled by Thomson Reuters for a profit of $2.95 per share.
Lowe’s reported second quarter sales of $27.3 billion compared to $21.0 billion, previous year. Analysts expected revenue of $24.27 billion for the quarter. Comparable sales increased 34.2 percent, for the quarter. Comparable sales for the U.S. home improvement business increased 35.1 percent. Lowes.com sales were up 135%, for the period.
Marvin Ellison, Lowe’s CEO, said: “Sales were driven by a consumer focus on the home, core repair and maintenance activities, and wallet share shift away from other discretionary spending.”
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