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Target, in the Spotlight Soon

By Seth Jayson – Updated Apr 10, 2017 at 7:14AM

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Checking expectations

Target (NYSE: TGT) is expected to report Q1 earnings on May 22. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Target's revenues will compress -0.1% and EPS will wither -8.7%.

The average estimate for revenue is $16.85 billion. On the bottom line, the average EPS estimate is $0.95.

Revenue details
Last quarter, Target notched revenue of $22.73 billion. GAAP reported sales were 6.8% higher than the prior-year quarter's $21.29 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $1.65. GAAP EPS of $1.47 for Q4 were 1.4% higher than the prior-year quarter's $1.45 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 25.2%, 50 basis points worse than the prior-year quarter. Operating margin was 8.0%, much about the same as the prior-year quarter. Net margin was 4.2%, 40 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $74.90 billion. The average EPS estimate is $4.65.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 2,440 members out of 2,671 rating the stock outperform, and 231 members rating it underperform. Among 784 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 747 give Target a green thumbs-up, and 37 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Target is outperform, with an average price target of $69.30.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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