Target’s (TGT) latest earnings report did not meet Wall Street’s expectations, as the retail giant reported a 3% year-over-year decline in sales and missed estimates for adjusted earnings. Storch Advisors CEO Jerry Storch joins Catalysts to discuss what these results mean for the broader state of the consumer.
Storch suggests that the consumer slowdown has been brewing for some time, but its effects have been "disguised" by inflation. He notes, "The consumer is spending more and getting less, and they know it" — forcing consumers to prioritize essential expenditures like food and healthcare. With Target having "made its name around nice-to-have fun products," Storch argues this is what is causing the disappointing results.
When asked about Target’s ability to turn the tide, Storch acknowledges the company’s efforts to create value by reducing prices on 5,000 items. However, he doubts the effectiveness of this strategy, saying, "They’re clearly trying to project value, but the problem is they’re not really set up to do it."
#youtube #inflation #stocks
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