MARKET BULLISH ON TARGET AFTER WALMART’S POSITIVE RESULTS
Target is scheduled to report its earnings before the market open on Wednesday. The closing price of Target on Monday was $83.27 and has been gaining momentum over the last two trading sessions.
Low unemployment rate in the last month could be one of the factors contributing to spending confidence. That factor could benefit Target also. Markets expect an EPS of $1.40, up from $1.23 last year and revenue of $17.23 billion, up from $16.43 billion last year.
Target missed earnings expectations in the last two quarters, according to FactSet data. Target beat revenue expectations in the last five quarters, according to FactSet.
Target shares have rallied 8.4% over the past three months, and have gained 27.7% for the YTD. The retailer has a number of things working in its favor, including e-commerce initiatives, store renovations, Toys ‘R’Us closures and an extra week for back-to-school shopping. New private label brands, better pricing and e-commerce offers are giving the company a boost.
On the technical front, the RSI is currently at 64.16% and suggests that the market can continue trading sideways. The %K has crossed the %D from below to the upside at 73.85% and suggests that the market may head upwards. The current market price is above the middle band of the Bollinger bands and is heading upwards Overall market sentiment seems to be positive.
TRADE SUGGESTION-LIMIT BUY AT 83.20 TAKE PROFIT AT 84.80 STOP LOSS AT 82.40