Target – TGT – Well-positioned to deliver strong fourth quarter performance
Target Corporation (NYSE: TGT) reported third quarter net earnings of $637 million, or $0.96 per share, which includes a 15-cent gain from the pending sale of its credit-card receivables portfolio. Adjusted earnings per share, a measure the company believes is useful in providing period-to-period comparisons of the results of its U.S. operations, were $0.90 in third quarter 2012, up 4.3 percent from $0.86 in 2011. A reconciliation of non-GAAP financial measures to GAAP measures is provided in the tables attached to this press release. All earnings per share figures refer to diluted earnings per share.
- Adjusted EPS of $0.90 Up 4.3% from Third Quarter 2011;
- GAAP EPS of $0.96 Includes 15-cent Gain from Pending Receivables Sale
“We’re pleased with Target’s third quarter financial performance, which reflects superb execution across each of our business segments,” said Gregg Steinhafel, chairman, president, and chief executive officer of Target Corporation. “We are well-positioned to deliver strong fourth quarter performance by offering compelling merchandise and unbeatable value through initiatives like the Target/Neiman Marcus Holiday Collection, 5% REDcard Rewards and our new Holiday Price Match which allow our guests to shop at Target with confidence throughout the holiday season.”
Interest Expense and Taxes
Net interest expense for the quarter was $192 million, including $20 million of interest on capitalized leases related to Target’s Canadian market entry. Net interest expense was $200 million in third quarter 2011.
The company’s effective income tax rate was 34.5 percent in third quarter 2012, including the favorable resolution of various income tax matters that benefited third quarter EPS by approximately 4 cents.
Capital Returned to Shareholders
In third quarter 2012, the company repurchased approximately 1.7 million shares of its common stock at an average price of $62.90, for a total investment of $104 million. The company also paid dividends of $236 million during the quarter.
Year-to-date the company has repurchased approximately 21.8 million shares of its common stock at an average price of $57.53, for a total investment of $1.25 billion, and paid dividends of $635 million.
TGT – Fiscal 2012 Earnings Guidance
For fourth quarter 2012, the company expects adjusted EPS of $1.64 to $1.74 and GAAP EPS of $1.45 to $1.55. The 19-cent difference between these ranges reflects the expected EPS impact of expenses related to the company’s Canadian market entry.
About Target – TGT
Minneapolis-based Target Corporation (TGT) serves guests at 1,782 stores across the United States and at Target.com. TGT plans to open its first stores in Canada in 2013. Since 1946, Target has given 5 percent of its profit through community grants and programs; today, that giving equals more than $4 million a week.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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