Target Stock Plummets Pre-Market After Q3 Earnings Miss, Lowered Guidance: Retail’s Worried About Tariff Impact

Shares of Target Corporation ($TGT) plummeted over 18% in Wednesday’s pre-market session after the firm’s third-quarter earnings missed Wall Street estimates while its full-year guidance revision disappointed investors.

If pre-market losses hold until the open, the stock would hit lows last seen about a year ago.

Target reported revenue rose over 1% year-over-year (YoY) to $25.67 billion during the quarter compared to a Wall Street estimate of $25.90 billion. Earnings per share came in at $1.85 versus an estimate of $2.30.

The company reported a 12.1% YoY decline in its net income to $854 million. It also lowered its full-year profit guidance, just three months after it had raised the forecast. Target now expects full-year adjusted EPS to range from $8.30 to $8.90 compared to an earlier forecast of $9 to $9.70.

CEO Brian Cornell highlighted that during the quarter, the firm saw several strengths across the business, including a 2.4% increase in traffic, nearly 11% growth in the digital channel, and continued growth in beauty and frequency categories.

However, it also encountered some unique challenges and cost pressures that impacted its bottom-line performance, he added.

Meanwhile, Digital comparable sales rose 10.8% indicating nearly 20% growth in same-day delivery powered by Target Circle 360 and double digit growth in Drive Up.

Beauty comparable sales grew more than 6% while Food & Beverage and Essentials categories grew low-single digits compared to the prior year.

Notably, Target’s third-quarter performance was underwhelming despite lowering prices on about 5,000 frequently bought items in May and on another 2,000 items during October.

Following the earnings announcement, retail sentiment on Stocktwits dipped into the ‘bearish’ territory (27/100) from ‘bullish’ a day ago, accompanied by ‘extremely high’ retail chatter.

Target Corporation Sentiment Meter and Message Volume as of 7:17 a.m. ET on Nov. 20, 2024 | Source: Stocktwits

Stocktwits users took note of the earnings miss and the potential impact of President-elect Donald Trump’s tariff policies.

Before factoring-in Wednesday’s pre-market plunge, Target stock has gained over 9% since the beginning of the year.