Target (NYSE:TGT) is set to report third-quarter earnings before the opening bell tomorrow. The results should give investors insight into the retail environment ahead of the all-important holiday shopping season. With 1,919 bull's-eye-branded stores throughout the U.S. and Canada, Target is a bellwether of consumer spending. Here's what investors should watch for when the company reports tomorrow.

Target Earnings

'Twas the week before Black Friday...
It's been a busy week for retailers, with Best Buy (NYSE:BBY) reporting quarterly earnings on Tuesday that beat expectations and Home Depot (NYSE:HD) soaring to a fresh 52-week high of $82.27 after delivering impressive top- and bottom-line growth in its own third quarter. But Best Buy's better-than-expected earnings of $0.18 per share and in-line revenue of $9.36 billion wasn't enough to stop investors from pushing the stock lower this week. Target could face a similar situation tomorrow when it reports.

Investors will want to keep an eye on Target's third-quarter same-store-sales number. Comparable sales for its second quarter were softer than expected, increasing just 1.2% in the period. But analysts are looking for sales growth of 2.6% in Q3. If Target posts declining same-store sales tomorrow, the stock could take a hit. Just look at what happened to shares of Wal-Mart (NYSE:WMT) last week.

Target Holidays

Wal-Mart's sales at stores that have been open at least a year declined 0.3% in its third quarter. In fact, "300 or so Wal-Mart U.S. stores were producing negative same-store sales of around 7%," according to Brian Sozzi of Belus Capital Advisors. As Wal-Mart's biggest rival in the big-box segment, this could spell trouble for Target. Investors will want to know whether Target has been able to pull more shoppers through its doors with initiatives, including exclusive product launches and limited-edition collections from top fashion designers.

Hitting Wall Street's target
Looking to Target's earnings reveal tomorrow, analysts are expecting earnings per share of $0.63 on revenue of $17.36 billion in the quarter. Shares of Target are up more than 15% year to date. But soft holiday sales could still put a dent in the stock going forward. Target is preparing for the holiday rush by opening its doors at 8 p.m. on Thanksgiving this year. Rival big-box chains plan to follow suit, with both Best Buy and Wal-Mart scheduling to open stores as early as 6 p.m. on Turkey Day.

For investors, the 2013 holiday season means the end of a record year for the stock market is looming. What will it mean for Target? We'll find out tomorrow.

Fool contributor Tamara Rutter owns shares of Target. The Motley Fool recommends Home Depot. Try any of our Foolish newsletter services free for 30 days. 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.