Target is expected to report a year-over-year drop in profit and a modest increase in revenue when it posts its first quarter 2023 results before the market opens on Wednesday, May 17.
Higher costs amid a slowdown in consumer spending due to continued elevated inflation are expected to have weighed on the retailer’s performance during the quarter.
Analysts, on average, expect Target to report earnings per share of $1.62 on revenue of $25.37 billion for 1Q, according to Zacks Consensus Estimate.
In the year-ago quarter, Target posted earnings per share of $2.19 on revenue of $25.2 billion.
Alongside its 4Q 2022 results, Target said it expects to report GAAP earnings per share and adjusted earnings per share in the range of $1.50 to $1.90 for 1Q.
The retailer added that it expects to see comparable sales in a wide range from a low-single-digit decline to a low-single-digit increase, and an operating income margin rate of 4% to 5%.
Target stock edged higher ahead of its results, up 1.2% at US$159.91 on Monday afternoon.
CMC markets analyst Michael Hewson noted that Target shares have struggled since hitting six-month highs at the start of February and have been languishing since the retailer reported a sharp fall in 4Q profits.
“Higher costs have been the main problem for Target as a business, these rose by 9.7% to $82.2 billion over the year [2022],” Hewson said.
“This appears to be a trend that might continue with Target’s 1Q guidance particularly underwhelming.”
Contact the author at emily.jarvie@proactiveinvestors.com
Follow her on Twitter @emilyjjarvie