A Piper Jaffray analyst believes Target Corp.’s sales trends have improved over the year-end shopping season, despite a massive breach of shoppers’ card data and lots of discounting by many retail chains.
Analyst Sean Naughton on Thursday predicted that sales in stores open at least a year, a key retail metric, rose 1.5 percent in the discounter’s fourth quarter, which runs from early November until Feb. 1. The company had forecast in November that the measure would be flat.
Some analysts and consultants have warned that Target transactions may have suffered because of the hacked data. The breach affected about 40 million debit and credit card holders who shopped at Target in late November and early December. Some consumers have filed lawsuits against the company. And last week, Target announced that some gift cards sold recently weren’t fully activated. It will honor the affected cards.
Target also offered a 10 percent discount for shoppers the weekend before Dec 25. Many retailers cut prices aggressively to lure buyers, as sales in physical stores fell for three straight weeks in December, according to retail research firm ShopperTrak.
Naughton said that even with those setbacks, Target was on track for its biggest gain in a year for the key sales measure, sales in stores open at least a year. In a note to clients, he cited improvement in overall consumer sentiment in December, sales reports from suppliers and checks with stores. He said his new prediction was partly based on Target letting shoppers buy items online and pick them up at a store, an option that he said appeared to be popular with customers.