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Target (TGT) Stock Dips Marginally Ahead of Q2 Earnings: What To Watch
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Shares of Target (TGT - Free Report) slipped 0.06% during regular trading hours Tuesday to sink just below their 52-week high. So let’s see what investors should expect from the retail powerhouse after strong reports from Walmart (WMT - Free Report) , Home Depot (HD - Free Report) , and other retailers.
Target has invested heavily in e-commerce and delivery to help fight off Amazon (AMZN - Free Report) . The Minneapolis-based retailer rolled out same-day delivery at over 700 locations during its first quarter, which was made possible by its $550 million acquisition of grocery delivery startup Shipt. Target also introduced its online ordering and curbside pickup service known as Drive-Up at more than 250 stores, along with other future-looking growth initiatives.
Target stock has jumped roughly 6% over the last month as investors continue to see that the company— along with Costco (COST - Free Report) , Kroger (KR - Free Report) , and Walmart—has been able to succeed despite Amazon’s encroachment.
Target Q2
Target is expected to see its quarterly revenues climb by roughly 5.5% to hit $17.34 billion, based on our current Zacks Consensus Estimate. Meanwhile, TGT’s adjusted quarterly earnings are projected to pop by 13.82% to reach $1.40 per share. But investors still need to know what chance TGT has to surpass our earnings estimate.
Luckily, we can turn to our exclusive Earnings ESP figure to help us find out. Zacks Earnings ESP (Expected Surprise Prediction) compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter. The Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change.
This is done because, generally speaking, when an analyst posts an estimate right before an earnings release, it means that they have fresh information which could potentially be more accurate than what analysts thought about a company two or three months ago.
A positive Earnings ESP paired with a Zacks Rank #3 (Hold) or better ranking helps us feel confident about the potential for an earnings beat. In fact, our 10-year backtest has revealed that this methodology has accurately produced a positive surprise 70% of the time.
Target currently sports an earnings ESP of -0.36, but boasts a Zacks Rank #2 (Buy) based on the retailer’s overall positive earnings revision activity for Q2, fiscal 2018, and fiscal 2019. Therefore, our model is inconclusive in this case. But, investors should note that TGT has fallen short of our quarterly earnings estimates in three out of the last six quarters, including the trailing two periods.
Target is scheduled to release its second-quarter earnings results before the opening bell on Wednesday, August 22.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Target (TGT) Stock Dips Marginally Ahead of Q2 Earnings: What To Watch
Shares of Target (TGT - Free Report) slipped 0.06% during regular trading hours Tuesday to sink just below their 52-week high. So let’s see what investors should expect from the retail powerhouse after strong reports from Walmart (WMT - Free Report) , Home Depot (HD - Free Report) , and other retailers.
Target has invested heavily in e-commerce and delivery to help fight off Amazon (AMZN - Free Report) . The Minneapolis-based retailer rolled out same-day delivery at over 700 locations during its first quarter, which was made possible by its $550 million acquisition of grocery delivery startup Shipt. Target also introduced its online ordering and curbside pickup service known as Drive-Up at more than 250 stores, along with other future-looking growth initiatives.
Target stock has jumped roughly 6% over the last month as investors continue to see that the company— along with Costco (COST - Free Report) , Kroger (KR - Free Report) , and Walmart—has been able to succeed despite Amazon’s encroachment.
Target Q2
Target is expected to see its quarterly revenues climb by roughly 5.5% to hit $17.34 billion, based on our current Zacks Consensus Estimate. Meanwhile, TGT’s adjusted quarterly earnings are projected to pop by 13.82% to reach $1.40 per share. But investors still need to know what chance TGT has to surpass our earnings estimate.
Luckily, we can turn to our exclusive Earnings ESP figure to help us find out. Zacks Earnings ESP (Expected Surprise Prediction) compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter. The Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change.
This is done because, generally speaking, when an analyst posts an estimate right before an earnings release, it means that they have fresh information which could potentially be more accurate than what analysts thought about a company two or three months ago.
A positive Earnings ESP paired with a Zacks Rank #3 (Hold) or better ranking helps us feel confident about the potential for an earnings beat. In fact, our 10-year backtest has revealed that this methodology has accurately produced a positive surprise 70% of the time.
Target currently sports an earnings ESP of -0.36, but boasts a Zacks Rank #2 (Buy) based on the retailer’s overall positive earnings revision activity for Q2, fiscal 2018, and fiscal 2019. Therefore, our model is inconclusive in this case. But, investors should note that TGT has fallen short of our quarterly earnings estimates in three out of the last six quarters, including the trailing two periods.
Target is scheduled to release its second-quarter earnings results before the opening bell on Wednesday, August 22.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>