Shares of Target (TGT) narrowed marginally on Tuesday after the retailer said it would likely miss expectations during the quarter due to softer-than-expected sales trends.
Target, which is expected to report first-quarter earnings on May 22, saw shares slump 1% on the news in early trade.
The Minneapolis-based broadline retail store now anticipates quarterly adjusted EPS to be slightly below the low-end of its prior guidance of $1.10 to $1.20 a share. Analysts in a Thomson Reuters poll are calling for earnings of 97 cents.
The announcement comes as retailers struggle amid a still weak economic environment that has weighed on consumer sentiment as well as an unusually long winter in the Northeast.
The company, which blamed the bearish view on seasonal softness for weather-sensitive categories across the store, also anticipates flat same-store sales growth, a key metric that measures transactions at stores open longer than a year.
For the full year, Target continues to expected non-GAAP earnings in the range of $4.85 to $5.05, topping the consensus view of $4.57.
Meanwhile, Target said first-quarter GAAP earnings, which aren’t used for comparison purposes on a year-to-year basis, are forecast to come in at just 28 cents, hurt by higher interest expense related to the early retirement of debt expected to lower EPS by roughly 41 cents a share, as well as dilution related to the Canadian segment.
GAAP results will be partially offset by accounting gains of 36 cents, Target said.