Target Inc. (TGT
) announced Monday that it’s hiring 70,000 in-store workers for the holidays. While that may sound good, it only matches the company’s total from each of the last four years.
So it’s no wonder that Target forecasts comparable sales will register unchanged to down 2 percent for the November-January holiday period, compared to an increase of 1.9 percent last year.
The company already is suffering from weak earnings, with comparable sales falling in the second quarter amid a decline of shoppers coming into stores. That represented the first decrease under CEO Brian Cornell. Even Internet sales growth slowed during the period. The second quarter performance helped send the stock into a tailspin. It has slid 15 percent over the past six months.
To be sure, Target is hiring 7,500 people to work in its fulfillment and distribution facilities, a bit more than last year, reflecting the increase in online sales. And Target has matched its profit forecasts this year through cost cuts.
The holidays are crucial for retailers like Target, providing about 30 percent of profits for the year.
Wall Street analysts offered no immediate reaction to Target’s decision. But over the last 30 days, 13 analysts have issued an opinion on Target, with only five positive. The median share price target is $78, compared to $69.18 Tuesday.
“We believe Target has solid market share in the bigger 'stock-up' trips for customers,” Cowen analysts wrote Monday. “But the increasing price competition from Walmart and the convenience of Amazon Prime will make the recent 'fill-in' trip weakness for Target persist."