Target Corp. said rising store traffic helped turn comparable-store sales growth positive for the first time in a year, giving the retailer an early win in its bid to improve stores and lure shoppers with new brands.
The retailer said Thursday it now expects a modest increase in comparable sales in its second quarter compared with prior guidance of a low- to single-digit percent decline.
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Target also gave a rosy earnings outlook, citing tax benefits from its supply-chain operations. The company now expects earnings per share to come in higher than prior guidance of 95 cents to $1.15.
Investors welcomed the news from Target and sent shares in the company 3.5% higher to $52.63 in morning trading. Despite Thursday's gains, Target shares are still down 27% so far this year.
The Minneapolis-based company, like retailers industrywide, has been coping with the effects of decades of overbuilding and falling foot traffic as e-commerce becomes increasingly popular.
Target said earlier this year it plans to invest $7 billion over the next three years on store improvements, new brands and developing its digital and supply-chain capabilities. It also expects to sacrifice about $1 billion of potential profit to lower prices and drive lower-margin digital sales.
Target will report its full second-quarter results on Aug. 16.
Write to Imani Moise at email@example.com
(END) Dow Jones Newswires
July 13, 2017 11:03 ET (15:03 GMT)