Target’s CEO Brian Cornell talks often about the split in retail between winners and losers. Target is clearly in the winners’ camp right now and is set to benefit during the holidays.
The big box retailer delivered another quarter of higher sales in stores and online and raised its earnings guidance going into the holiday shopping stretch. Sales at stores open at least a year and online grew 4.5% during the retailer’s third quarter compared with 2018, while its income increased close to 15% for the same period.
Cornell credited Target’s “highly differentiated” merchandise value, in-store shopping experience and convenient online shopping options for its strong sales. Target has also taken advantage of store closures by Toys ‘R Us and others to expand its toy selection.
Target’s (TGT)stock rallied around 9% during pre-market trading. Target’s (TGT)stock has gained 67% this year, making it one of the leading stocks on the S&P 500 this year.
Retailers have reported mixed earnings heading into the holidays. Walmart (WMT) and Target have grown sales, while Home Depot (HD), Kohl’s (KSS) and JCPenney (JCP) struggled.
Retailers are expecting a strong holiday season. The National Retail Federation estimates retail sales in November and December will grow between 3.8% and 4.2% compared with a year ago.
“We continue to see a very healthy consumer environment,” Cornell said last month.
Target has said that it’s preparing for the holidays by adding seasonal employees and increasing the number of hours employees work.
Some Target workers recently said that their hours have been scaled back, straining them financially. Target has said that existing staffers are working this year, on average, “approximately the same number of hours as they were last year” and the year prior and slightly more than they were three years ago.
