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The results of the first quarter of Target were not good and the management reduced the company’s management for 2025.
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The company faces winds of tariffs and weakens consumer demand.
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Investors are probably better to sit on Target shares.
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Many investors couldn’t wait to see a retail giant Intents (Nyse: tgt) The last quarter will look and unfortunately it wasn’t great. The company missed the consensus assessments of sales and profit analysts, and management lowered the company’s year -round prospects.
Target has been on a rough road in the last few years, and the next 12 months can also be Rocky. This is where the target stock can be in a year.
Target sales declined in 2024 and investors hoped that 2025 could be the beginning of something new for the retail giant, but they were quickly disappointed when Target reported a sales drop by 5.7% through the same stores in the first quarter.
The sales of the company of $ 23.8 billion decreased by nearly 3% compared to the previous year and missed a consensus estimate of Wall Street of $ 24.2 billion. Meanwhile, non-GAAP (generally accepted accounting principles) corrected profits fell by 36% to $ 1.30 per share.
These revenue did not reach the consensus of analysts from $ 1.61 per share, and the result of the company’s bad results in the quarter sent the shares, leaving it 39% in the last year.
Target CEO Brian Cornell said when a profit called that his company was facing an “extremely challenging environment” and added that the company faces several winds currently, including reducing consumer confidence and potential tariffs. He added: “I want to be aware that we are not satisfied with this presentation and moved urgently to move during this period of instability.”
As a result, Target has lowered its sales guidelines throughout the year, expecting a decline in low single numbers, compared to its previous increase in an increase of about 1%. This means that all the hope that investors have had, that 2025 will be the year in which the target is experiencing a meaningful turn.
One of the problems for this purpose is that many customers focus on basic costs, such as groceries, and transfer their costs to other retailers who offer lower prices and more selection, such as WalmartS
The bad news is that consumers seem to tighten their belts as they focus on economic uncertainties from tariffs and potential slowing the economy. A recent study by the University of Michigan found that consumer perspectives have fallen to their second lowest record, as Americans predict that tariffs can cause inflation.