Target Corp (NYSE:TGT) shares shot 15% higher after returning to growth in the past quarter, with earnings growing more than Wall Street expected.
Sales in the second quarter increased 2.0% on a comparable basis versus a year ago, the high end of the company's previous guidance as traffic grew 3% and digital sales grew 8.7%.
Earnings per share rose 40% to $2.57, beating the Street's EPS forecasts of $2.19.
"We made a commitment to get back to growth in the second quarter, and the team delivered, all while expanding operating margins and growing EPS by more than 40% compared to last year," said Target CEO Brian Cornell.
He said growth was driven "entirely" by traffic in stores and digital channels, while also highlighting improving trends in discretionary categories such as apparel and beauty.
The company paid dividends of $509 million in the quarter, compared with $499 million last year, reflecting a 1.9% increase in the dividend per share, while buying back $155 million of its shares.