On May 15, Target (NYSE:TGT) released Q1 2006 earnings for the period ended April 29.

  • Revenues and profits increased 12%.
  • Gross margins rose companywide, but stepped back on a merchandise-only basis.
  • More cash consumed by operations plus more capital spending meant more negative free cash flow than the prior year.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

Q1 2006

Q1 2005

Change

Sales

$12,800

$12,863

$11,477

12.1%

Net Profit

--

$554

$494

12.1%

EPS

$0.63

$0.63

$0.55

13.9%

Diluted Shares

878

894

(1.8%)



Get back to basics with a look at the income statement.

Margin Checkup

Q1 2006

Q1 2005

Change*

Gross Margin

34.13%

34.16%

(0.03)

Operating Margin

7.91%

7.9%

0.01

Net Margin

4.31%

4.3%

0.01

*Expressed in percentage points.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q1 2006

Q1 2005

Change

Cash + ST Invest.

$989

$1,152

(14.1%)

Accounts Rec.

$5,368

$4,857

10.5%

Inventory

$6,030

$5,407

11.5%



Liabilities

Q1 2006

Q1 2005

Change

Accounts Payable

$5,707

$5,110

11.7%

Long-Term Debt

$8,596

$9,005

(4.5%)



Learn the ways of the balance sheet.

Cash Flow Highlights

Q1 2006

Q1 2005

Change

Cash From Ops.

$527

$600

(12.2%)

Capital Expenditures

$884

$717

23.3%

Free Cash Flow

($357)

($117)

N/A



Find out why Fools always follow the money.

Related companies:

  • Wal-Mart (NYSE:WMT)
  • BJ's Wholesale Club (NYSE:BJ)
  • Sears Holdings (NASDAQ:SHLD)
  • Costco (NASDAQ:COST)

Related Foolishness:

What kind of investor are you? Costco was recommended in Stock Advisor and Wal-Mart in Inside Value. Learn more about them -- and talk to other investors interested in these stocks on our discussion boards -- when you take afree trial to any of our newsletters.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so checkFool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, Seth Jayson had no positions in any company mentioned here. Fool rules are here.