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Target Raises Full-Year Sales Growth Outlook as Fiscal First-Quarter Results Top Views

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Target Raises Full-Year Sales Growth Outlook as Fiscal First-Quarter Results Top Views

Target (TGT) raised its full-year sales growth outlook on Wednesday as the retailer recorded higher-than-expected fiscal first-quarter results.

The company now expects sales to increase by 4% year over year in fiscal 2026, compared with its previous guidance for a 2% rise. The current consensus on FactSet is for $107.15 billion.

Adjusted earnings are now expected to be at the high end of the company's previously issued outlook range of $7.50 to $8.50, it said Wednesday. The Street is looking for non-GAAP EPS of $8.12. Shares of the retailer were up 1.5% in the most recent premarket activity.

"As we look ahead, we're focused on staying disciplined and flexible in an uncertain operating environment," Chief Executive Michael Fiddelke said.

For the three-month period ended May 2, Target's adjusted EPS advanced 32% to $1.71, surpassing the average analyst estimate on FactSet of $1.47. Sales improved to $25.44 billion from $23.85 billion in the prior-year quarter, exceeding the Street's view for $24.66 billion.

"First-quarter financial results were stronger than expected, providing encouraging early signs that our clarified strategy is resonating with our guests and driving broad-based growth across our business," according to Fiddelke. "While we're pleased with our (first-quarter) performance, our focus remains on building consistent, long-term growth, and we recognize there is much more work in front of us."

Comparable sales inclined 5.6%, more than the market's forecast for a gain of 2.4%, reflecting comparable store and digital sales growth of 4.7% and 8.9%, respectively. The number of transactions increased 4.4%, rebounding from a 2.4% decline in the 2025 quarter.

"It was a solid quarter and investors will be trying to assess whether the improved performance is sustainable (against relatively easy comparisons) or overly fueled by short-term levers," Truist Securities said in an emailed client note. The brokerage has a hold rating on the company's stock.

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