Target beats, Costco disappoints in the discount sector
New York -- Target and TJX Cos. both reported better-than-expected results in May, with a 4.4% and an 8% increase in same-store sales, respectively. Wall Street expected Target same-store sales to be up 3.5% in May and forecasted TJX sales to rise 5.3%.
TJX's strong performance in May even prompted the company to raise its forecast to the high end of its previous earnings estimate. And Target saw strength from such categories as food, clothing and health supplies, which helped push results to high end of the retailer’s expected range. “We’re confident that Target is well-positioned to continue delivering a superior guest experience and strong financial performance for many years to come,” said Target CEO Gregg Steinhafel. Total sales for the four weeks ended May 26 rose 5% to $5.04 billion.
But not all chains outdid expectations. Costco Wholesale reported a same-store sales rise of 4%, missing the 4.3% that analysts forecasted. According to the company, results were negatively impacted by deflation in gasoline prices and foreign currencies.
Among other discounters’ results in May:
- Ross was up 8%;
- SteinMart was up 3%;
- Cato May same-store sales rose 3%;
- Stage was up 8%; and
- Fred’s edged up 1.3%.