Target News Is Rough For Wal-Mart
Stocks: (TGT)(WMT)
Target, Wal-Mart's smaller competitor, put up strong numbers today. Same store sales for the quarter ending July 29 increased 4.6%. Revenue rose 11% to $13.3 billion. Net earnings rose to $609 million from $540 million in the period a year ago. Since Wal-Mart's July same-store sales were up 2.4%, it would appear that Target is growing faster. At $80 billion in revenue a quarter, Wal-Mart is a bit larger than Target.
Wal-mart was hoping to take some of Target's upscale buyers by putting more expensive items in some of its stores. According to Reuters, Wal-Mart is continuing to try to reach "wealthier" buyers in the hopes of improving margins.
Based on the Target results and Wal-Mart same-store sales in July, it would be difficult to make the case that the larger retailer is stealing much Target business. At least the 11% increase in sales at the smaller company would indicate that a Wal-Mart plan to gain share is not gaining much traction.
The proof of the pudding is in the eating. Wal-Mart's quarterly results wil be out soon enough.
Douglas A. McIntyre can be reached at douglasamcintyre@gmail.com. He does not own securities in companies that he writes about.
Target, Wal-Mart's smaller competitor, put up strong numbers today. Same store sales for the quarter ending July 29 increased 4.6%. Revenue rose 11% to $13.3 billion. Net earnings rose to $609 million from $540 million in the period a year ago. Since Wal-Mart's July same-store sales were up 2.4%, it would appear that Target is growing faster. At $80 billion in revenue a quarter, Wal-Mart is a bit larger than Target.
Wal-mart was hoping to take some of Target's upscale buyers by putting more expensive items in some of its stores. According to Reuters, Wal-Mart is continuing to try to reach "wealthier" buyers in the hopes of improving margins.
Based on the Target results and Wal-Mart same-store sales in July, it would be difficult to make the case that the larger retailer is stealing much Target business. At least the 11% increase in sales at the smaller company would indicate that a Wal-Mart plan to gain share is not gaining much traction.
The proof of the pudding is in the eating. Wal-Mart's quarterly results wil be out soon enough.
Douglas A. McIntyre can be reached at douglasamcintyre@gmail.com. He does not own securities in companies that he writes about.
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