Target Corp reported a steeper-than-expected decline in fourth-quarter same-store sales and said it expected sales to continue to fall this fiscal year, sending its shares tumbling 13 percent in premarket trading on Tuesday.
The company has struggled with declining sales as shoppers increasingly gravitate to online retailers such as Amazon.com Inc and spend more on big-ticket purchases such as cars and home renovations rather than electronics, food and apparel.
The big box retailer’s net income slumped to $817 million, or $1.45 per share in the fourth quarter ended Jan. 28, from $1.43 billion, or $2.32 per share, a year earlier.
Analysts on average were expecting a profit of $1.51 per share, according to Thomson Reuters I/B/E/S.
Sales at stores open for at least a year fell 1.5 percent, missing the average analyst estimate of a decline of 1.3 percent, according to research firm Consensus Metrix.
Target forecast same-store sales would fall in the low- to mid-single digit percentage range in the first quarter and that it would earn $0.80-$1.00 per share from continuing operations in the period.
The Minneapolis-based retailer said it expected a low-single digit decline in full-year comparable sales, and forecast full-year earnings from continuing operations of $3.80-$4.20 per share.
Target’s shares slumped 12 percent to $58.90 in premarket trading.
The stock has fallen about 6 percent since Target warned in January that weak holiday sales and deep discounts in a competitive environment would hurt fourth-quarter margins and earnings.
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