Target slides after disappointing holiday guidance

  • Target reported earnings and sales that topped estimates in the third quarter.
  • It raised its guidance for the full year, but issued a lower profit forecast for the holiday season.
  • Target shares slide after the news.
  • To see Target’s stock price, click here.

Target‘s shares slid in pre-market trading after the retailer issued an underwhelming profit forecast for the holiday season.

The company sees earnings of $US1.05 to $US1.25 per share in the fourth quarter, below the Wall Street estimate of $US1.24. Its shares fell more than 5% after the news.

Despite the bleak forecast, the company reported better-than-expected same-store sales. Its sales rose 1.4% to $US16.67 billion, above analyst predictions of $US16.61 billion. The retailer earned an adjusted $US0.91 per share, above analyst estimates of $US0.88.

“While we expect the fourth-quarter environment to be highly competitive, we are very confident in our holiday season plans,” Brian Cornell, Target’s chairman and CEO said in a release.

The department store operator, like Wal-Mart and other competitors, have the difficult task of drawing customers to their stores, as consumers shift to online shopping and tech giants like Amazon.

Target was down 20.93% for the year.

To read more about how the company has prepared in advance of the holiday season, click here.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.