Monday, February 25, 2013

Will These Numbers from Target Be Good Enough for You?

Target (NYSE: TGT  ) is expected to report Q4 earnings on Feb. 27. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Target's revenues will expand 6.7% and EPS will grow 5.6%.

The average estimate for revenue is $22.71 billion. On the bottom line, the average EPS estimate is $1.51.

Revenue details
Last quarter, Target reported revenue of $16.93 billion. GAAP reported sales were 3.2% higher than the prior-year quarter's $16.40 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.90. GAAP EPS of $0.96 for Q3 were 17% higher than the prior-year quarter's $0.82 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 31.0%, 30 basis points worse than the prior-year quarter. Operating margin was 6.0%, 40 basis points worse than the prior-year quarter. Net margin was 3.8%, 40 basis points better than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $73.20 billion. The average EPS estimate is $4.45.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,430 members out of 2,663 rating the stock outperform, and 233 members rating it underperform. Among 795 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 747 give Target a green thumbs-up, and 48 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Target is outperform, with an average price target of $69.85.

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