Target, after solid 3Q, gets cheery about the holidays
Target breezed past Wall Street expectations for the third quarter and with the crucial holiday season fast approaching, it upped its key sales outlook for the critical period as well.
Target also increased its annual profit outlook. Shares surged almost 8 percent today before the opening bell.
The news was encouraging after the retailer stumbled in the second quarter, as it saw traffic and a key sales measure fall after a string of quarterly gains. But for the third quarter, Target saw traffic improve and its key sales metric slipped just 0.2 percent, much higher than its guidance that called for that metric to be anywhere from flat to down as much as 2 percent.
The results show Target's efforts to fix some of the issues that dragged down its business this past summer are working. One of the big problems: Target didn't push the second part of its "Expect More, Pay Less" slogan and so it vowed it would heavily market items like groceries to bring shoppers back to the stores.
Under Brian Cornell, Target has been trying to reinvigorate itself to restore its cheap-chic status. It's focusing on categories like fashion, home furnishings and wellness products, creating vignettes featuring home products and launching the children's line Cat & Jack.
For the holiday shopping season, it is hoping to lure shoppers with lots of different ways from a Broadway style marketing campaign to more exclusive toys.