A Target local to the author, just before shutting down in January. This aisle used to hold cold beer and various snacks. Image source: Anders Bylund.
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What: Shares of Target fell 13.5% in May 2016, according to data from S&P Global Market Intelligence
A week later, those pessimists were proven right. Target's own first-quarter report
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Now what: Target actually beat earnings estimates in the first quarter, and CEO Brian Cornell was "pleased" with that report. But it wasn't all rainbows and butterflies, as Cornell also pointed to a "challenging" consumer environment in the short term.
The company's promotional events have proven successful in recent quarters, and you can expect more of these revenue-grabbing swings as Cornell fights to right the ship. Target is also taking controversial stances on important issues like minimum wagetransgender rightsrarely affects a major company's bottom-line results
It's back to Brass Tacks 101 for the nationwide retailer. Annual sales have only increased by 6% over the last 5 years, alongside falling operating margins and wildly bouncing free cash flows. Target's management needs to put a finger on the retail strategies that work and double down on these opportunities. Hot tip: Cornell is thinking hard about his minuscule online sales and the click-to-lay-away digital order approach. He could (and probably should) put his back into these options.
The article Why Target Corporation Fell 13.5% in May