Target’s bleak holiday outlook is bad news for other retailers

The Street

TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and why Target isn’t expecting to have a happy holiday.

Transcript

00:00I'm Conway Gittins reporting from the New York Stock Exchange.

00:03Here's what we're watching on the street today.

00:05Wall Street has its eyes on geopolitical tensions

00:07between Ukraine and Russia, and that

00:09is resulting in some market volatility on Wednesday.

00:12Bitcoin is making fresh record highs,

00:14and the price of gold is up.

00:17Turning to other headlines, we're

00:19getting mixed signals from retailers

00:21as they face their most important time of the year,

00:24holiday shopping season.

00:26Target sounded the alarm, saying consumers are still

00:29being picky and choosy about what they buy

00:31and what they're willing to pay.

00:33That is in stark contrast to Walmart,

00:36who said customers are spending more compared

00:39to the same time last year.

00:41Target's warning comes amid a terrible earnings update.

00:44Third quarter profits missed estimates by the biggest measure

00:47in two years.

00:49Sales were weaker than expected, even though the retailer

00:52has been slashing prices on thousands of products

00:55for months.

00:56The company's chief operating officer

00:57told investors people just aren't

00:59buying what they don't need and are still price conscious.

01:03Quote, it's disappointing that a deceleration

01:06in discretionary demand combined with cost pressures

01:09have caused us to take our guidance back down

01:12after raising it last quarter.

01:15Target also has an inventory problem.

01:18It bought a lot of goods in anticipation of the port worker

01:21strike, but with that strike short-lived and shoppers

01:24dragging their feet, Target is now oversupplied.

01:28This likely means one thing for Target shoppers,

01:31even bigger holiday discounts as Target

01:34turns to deeper price cuts to save the holidays.

01:38And that'll do it for your daily briefing from the New York

01:40Stock Exchange.

01:41I'm Conway Gittens with The Street.

Category

Transcript

Recommended