This could be ugly

Target is scheduled to release monthly sales for March this Thursday, and the company has already indicated its same-store sales figures won’t be pretty due to the late arrival of Easter. The holiday isn’t until April 24 this year, so the bulk of sales related to Easter will occur in April whereas last year Easter fell on April 4, so a greater percentage of seasonal sales fell in March. The situation wreaks havoc on monthly comparisons, which is why Target has forecast March comps will decline in the mid to upper single-digit range as the results are compared to a prior year period that included the benefit of Easter.

Assuming the company produces the anticipated negative numbers, the March weakness is then expected to be offset by a hearty performance in April with comps currently forecast to be in the mid-teens. That figure may be updated come Thursday as Target gets a read on whether promotional efforts that have been in stores now for several weeks prompted shoppers to pull forward some of their seasonal spending. Such an impact is likely to be minimal, which sets the company up for a monster April, as results are aided by the late Easter in addition to what are likely to be more favorable weather conditions, which bodes well for outdoor activities which are an important part of Easter.

By the end of April, when the same-store sales situation has sorted itself out, Target is likely to be in the range of a low single-digit increase for the combined two month period. At least that is the officials guidance provided at the time February results were released and the negative number for March was forecast.


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