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6 Battling Big-Box Retailers: Who’s Winning?

The sector's off to a mixed start so far this year

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Target (NYSE:TGT)Year-to-Date Gains: 23%

The market’s recent spike has also sent discounter Target (TGT) to all-time highs, despite the fact that 2013 has hardly been the year of red and white — at least on the earnings front.

The first three months of 2013 represented Target’s first drop in revenue in an eye-popping 14 quarters, thanks in part to a slide in same-store sales during the period. The result: The company’s Q1 earnings of 77 cents per share were not only a dime short of its own expectations, but 35% lower year-over-year. One factor that got blamed: bad weather.

Even warming summer months aren’t expected to heat up the company’s numbers, though. Earnings are supposed to fall again not just this quarter, but for the full-year — a recently realized possibility that would break a half-decade streak of full-year growth.

Just three months ago, analysts expected adjusted earnings of $4.57 per share — which would have been a year-over-year gain. Now, they are hoping for a mere $4.36 — a two-cent fall.

Things are expected to get back on track and then some next year, though — possibly part of the reason investors just keep bidding the stock higher. Earnings for the fiscal year ending in January 2015 are expected to improve by 25%, while that should level out to annualized growth of 11% over the next five years.

Article printed from InvestorPlace Media,

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