Piper Jaffray Remains Bullish on Target (TGT) Following 2Q EPS Beat
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Piper Jaffray reiterated an Overweight rating and $86.00 price target on Target (NYSE: TGT) following the company's 2Q earnings report. TGT reported an $0.11 EPS beat, while comps were down 1.1%. Comparable sales in both Q3 and Q4 are expected down 2% to flat compared to current Street estimates of +1.2% and +1.7% for Q3 and Q4, respectively. Q3 EPS is expected in the range of $0.75 to $0.95 compared to consensus at $0.96.
Analyst Sean Naughton commented, "Target reported Q2 results this morning with comparable sales in-line with guidance and Street estimates while earnings beat by $0.11. Transactions were down 2.2% in the quarter while the average transaction amount was up 1.1%. Guidance was disappointing as the company expects sales pressure to continue throughout the back half of the year. Q3 and Q4 comp sales were guided down 2% to flat compared to the Street at +1.2% and +1.7% for Q3 and Q4, respectively. EPS is now expected in the range of $4.80 to $5.20, bracketing consensus at $5.13. While the forecast for continued comp pressure is disappointing, we believe the depressed valuation should limit downside today for TGT shares."
Shares of Target closed at $75.48 yesterday.
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