News About Banking Industry

Target stores sales and traffic slow in Q3; Company upbeat about holiday

Target’s (TGT) turnaround plan appeared to have a slight slowdown as same-store traffic and sales fell from the second quarter. The company’s third quarter earnings met expectations Wednesday, but sales missed. Shares fell more than 5% to $68.70 in afternoon trading. But the company is upbeat about the upcoming holiday season. It raised the lower end of its full-year guidance saying that it is confident in its merchandising and marketing plans as it enters the most critical season of the year.Data Security Breach Affects Target Corp

Retail earnings have been somewhat mixed with companies including Macy’s and Nordstrom reporting weakness in the past week. The news has sent retail stocks down over worries about the holiday shopping season, particularly as some retailers reported slower sales through October due to warm weather.

Target has been trying to gain back the chic status it had lost in recent years with trendier products and better in-store displays that include mannequins in apparel sections and inspirational table settings in home and better integration between its stores, web and mobile. It has been pushing four categories in particular — apparel and accessories, baby, kids and wellness. Sales in those areas grew more than two and a half times faster than the company average in the quarter ended Oct. 31.

That’s down though from the growth those categories saw in the second quarter, when they grew three times as fast as the company average. Sales at stores open at least a year and traffic were also slightly below the second quarter, but still increased 1.9% and 1.4% respectively. Still, the results show “the strategy is taking hold and guests are responding,” Chief Financial Officer Cathy Smith said on a conference call with media.