Target shoots and misses Wall Street's expectations

Nov. 21 (UPI) Target slightly missed earnings estimates, and its profits fell 46 percent hurt by weaker sales in the U.S. and high costs in Canada.

While unemployment figures are slightly improving, wages are stagnant and Americans are reluctant to spend. U.S. stores rose 0.9 percent, below company estimates.

Canadian operations cut into profits by 29 cents a share, steeper than the 22 cents Target predicted. The recent Canadian expansion of 23 stores in the third quarter has led the retailer to cut prices to clear inventory. It aims to open 124 stores by the end of the year.

Profits dropped to $341 million, or 54 cents per share, from $637 million, or 96 cents per share in the year-ago period. Analysts surveyed by Bloomberg expected profits of 62 cents per share.

Target competes with Kohl's, Best Buy and Walmart, the world's largest retailer. All four companies missed analyst estimates despite overall retail figures rising, and all four have lowered their forecasts for the year with holiday price-cutting impacting bottom lines.

Target's revenue inched 1.9 percent to $17.3 billion, below the $17.4 billion expected.

This comes just before Black Friday as stores compete for the holiday rush. Walmart announced it will match Best Buy and Target deals, and is beginning sales as early as this week.

The Minneapolis-based retailer's shares fell almost 4 percent to $93.90 by 1:30 pm in New York.

[Wall Street Journal] [Bloomberg]