What happened

Target (NYSE:TGT) shareholders beat a surging market in November as the stock rose 18% compared to the 11% increase in the S&P 500, according to data provided by S&P Global Market Intelligence.

That rally put the retailer in solidly positive territory for the year, up over 35% by early December.

A woman uses her smartphone while shopping.

Image source: Getty Images.

So what

Target benefited from rising investor enthusiasm about the end of the COVID-19 threat thanks to positive vaccine development news last month. But the bigger factor behind its stock surge last month was a strong earnings report.

CEO Brian Cornell and his team revealed a 21% sales spike for the fiscal third quarter that runs through late October. That boost combined with improving profitability to send net income over $1 billion, up 42% year over year.

Now what

Target is preparing for record digital sales volumes this holiday season that might stress its multi-channel selling platform. Executives plan to make heavy use of stores as fulfillment centers, though, so they are optimistic about handling the surge. That said, the retailer said in a conference call with investors that there's a wide range of demand trends that could develop over the next few weeks, and Target is prioritizing flexibility as it seeks to end its record 2020 year on a positive note.

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