by Ian Harvey
November 20, 2019
Target Corporation shares traded higher after the company easily beat third-quarter earnings views and raised full-year targets once again. Target stock leapt to a record high, with its third straight post-earnings gap higher.
“Stock Options Made Easy” “Earnings Predictions” members are now up 306% potential profits.
Are you missing out on these profits? Why not join us and benefit as well!
And see what we are considering for future trades on Target Corporation!
TGT, the operator of general merchandise stores, saw its shares spike 14% in early trading today to a record high following much stronger than expected earnings.
Target stock has held near highs since an Aug. 21 breakaway gap. Blowout earnings results fueled the big move right past a buy point — and the stock hasn't looked back. And today, TGT stock staged another big gap-up, following its latest earnings report.
The company reported earnings per share (EPS) of $1.36, easily beating analyst estimates of $1.18 and blowing their own guidance of $1.04 to $1.24 out of the water. Target reported EPS of $1.09 during the third quarter of 2018.
Target recorded $18.67 billion in revenue for the third quarter of 2019, beating the consensus estimate of $18.47 billion and increasing 4.7% over the $17.82 billion reported during the same quarter of 2018.
"The Target team did an excellent job serving our guests and executing our strategy throughout the third quarter. Our third quarter results are further proof of the durability of our strategy, as we're seeing industry-leading strength across multiple metrics, from the top line to the bottom line," Target CEO Brian Cornell said.
Shares closed up 14.06%, up $15.58, at $126.43 on the stock market today.
“Stock Options Made Easy” “Earnings Predictions” members were advised to buy Target Corporation call options on Monday, November 18, 2019, and have already pocketed potential profits of 306%.
The Recommended Trade on Target Corporation.....
“Target Corporation (NYSE:TGT), the operator of general merchandise stores, will report earnings before the market opens. The consensus earnings estimate is $1.18 per share on revenue of $18.47 billion; but the Whisper number is higher at $1.22 per share.
The company's guidance was for earnings of $1.04 to $1.24 per share. Consensus estimates are for year-over-year earnings growth of 8.26% with revenue increasing by 3.64%.
In the trailing four quarters, the company’s bottom-line has outperformed the Consensus Estimate by 4.6% on average. In the last reported quarter, the company delivered a positive earnings surprise of 13%.
After registering bottom-line improvement of 23.9% in the second quarter, Target is likely to deliver year-over-year growth in the third quarter as well.
TGT has been a strong outperformer over the last 12 months as the company’s ability to finally show material improvements in its online business has Wall Street very bullish on the stock. The company struggled at the onset of the digital age, but investments in its e-commerce business have been paying off, and investments in re-designing its brick-and-mortar locations and improving customer satisfaction has been driving higher sales both online and in-store.
Earnings are up 10.9% per annum over the last five years and Wall Street expects more of the same moving forward with future earnings growth forecast at 9.3% per annum for the next five years.
Positive factors.....more information click here.....
..... Short interest has decreased by 42.9% and overall earnings estimates have been revised higher since the company's last earnings release.
Of the 20 analysts who cover the stock 13 rate it Strong Buy and 7 rate it Hold.”
The Option Trade Recommended: Buy the TGT DEC 20 2019 115.000 CALL at approximately $3.60. (astute traders may have been able to buy at $3.10: sold at $12.60; a potential profit of 306%.)
Driving Factors for Target Corporation.....
Robust traffic, favorable store comps and a surge in comparable digital sales are clearly working in favor of this Minneapolis-based company.
Instead of rolling over like brick-and-mortar retailers were expected to, Target is countering by investing in its e-commerce strategy and teaming up with designers for exclusive product launches. Such moves have helped the discount chain turn around its earnings and boost sales.
The massive retailer has remained competitive even as consumers have continued to demand their products quicker and quicker. Expectations have moved from two-day shipping to one-day shipping to same-day delivery.
Target is deploying resources to enhance omni-channel capacities, coming up with new brands, remodeling or refurbishing stores, and expanding same-day delivery options.
During the quarter, Target repurchased shares worth $294 million and paid dividends of $337 million.
Target has spent billions of dollars on building its private label business and opening smaller stores in college towns and urban areas to lure customers, helping it gain an edge over its rivals.
"Apparel saw the most dramatic share gains in the quarter," Chief Executive Officer Brian Cornell said. Comparable sales from the business jumped 10%.
YOU NEED TO BE IN TO PROFIT!
Analysts are bullish on discounters ahead of the holiday shopping season, amid consumer confidence and trade war uncertainty.
Target Corporation CEO Brian Cornell said, "Looking ahead, we have ushered in the holiday season with an unwavering commitment to guest service that complements our highly differentiated, value-driven assortment and our exceptional in-store shopping experience, as well as an unmatched suite of easy and convenient fulfillment options."
Target envisions fourth-quarter adjusted earnings between $1.54 and $1.74
per share, the mid-point of which — $1.64 — is higher than $1.53 reported in
the year-ago period and in line with the Consensus Estimate. For fiscal
2019, management now anticipates adjusted earnings in the band of $6.25-$6.45,
up from the prior range of $5.90-$6.20. The company had reported earnings of
$5.39 in fiscal 2018. The Consensus Estimate for fiscal 2019 currently
stands at $6.17.
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Where to now for Target Corporation?
The holiday season is crucial for retailers as it can account for as much as 40% of annual sales. The season has six fewer days this year, prompting retailers to be more aggressive with deals and deliveries.
"We're very excited about the opportunity this holiday season with the growth we've seen and the growth that's in front of us from a same-day perspective," Chief Operating Officer John Mulligan told analysts on a post-earnings call.
Target had been setting up a potential follow-on buy opportunity as it tested its 10-week moving average. Today's big move off the line sealed the deal. It staged a breakaway gap, which occurs when a stock gaps up past a proper entry. In such cases, the opening price of the breakaway gap can be used as the correct buy point.
The questions remain......Will Target Corporation continue to gain market share?
Will we recommend another options trade on Target Corporation?
What will “Stock Options Made Easy” advise members to do?
AS ALWAYS THE DECISION IS YOURS!
An Important Note: That any suggestions for options trade considerations require investors/traders to use their own discretion as to when to enter or exit! As well, it is advisable to do further research and due diligence before executing your trade.
It is sometimes best to exit a trade, if there is already sufficient profit accrued, before an earnings report is presented. GREED can be the undoing of a nice profit!