Target, other retailers beat revenue projections in US

Target Corporation has reported a bigger-than-expected rise in quarterly profit and forecast a more profitable year than analysts were anticipating, as its credit card business continued to grow and sales heated up with the summer weather.Shares of Target, which has more than 1,760 US stores and is getting ready to open stores in Canada, were up 2.1 per cent to $50.41 in afternoon New York Stock Exchange trading after rising as much as 5.8 per cent earlier on Wednesday.Retail results are highlighting a split between middle and upper-income shoppers, who may be waiting a bit before they buy, versus the unemployed and low-income workers struggling to make ends meet.“While optimism at all income levels has improved since the recession, wealthy households continue to be the most optimistic,” Kathryn Tesija, Target’s executive vice president of merchandising, said during a conference call.“The 20 per cent of households with the highest incomes are shopping more often and spending more, while the other 80 per cent have been cutting trips and spending less,” she said of retailers’ experience in general.Target’s shoppers are buying closer to when they need things, so the company said it is a bit too early to fully judge August sales that include back-to-school purchases from school uniforms to dorm-sized refrigerators. So far, August sales are within Target’s forecast of a mid single-digit increase, though slightly below the increases seen in June and July, Chief Financial Officer Douglas Scovanner said.Target’s same-store sales rose 4.5 per cent in June, 4.1 per cent in July and 3.9 per cent in the second quarter. Target was not the only retailer reporting better-than-expected results. Wal-Mart Stores, the world’s largest retailer and Target’s main competitor, said on Tuesday that its profit rose more than expected.On on Wednesday, retailers such as BJ’s Wholesale Club Inc and office supplies leader Staples Inc also reported results that surpassed expectations.Staples Chief Executive Officer Ron Sargent said he did not see a double dip in the US economy, though the country is “probably more likely to stay in economic purgatory for a while longer.” From / Gulf Today