Shiver Me Timbers! Target's Treasure Chest is Empty!

Why is the Rum Gone? And the Profits?

Savvy? It appears our friends at Target have hit a bit of a reef eh? Their latest earnings report is as disappointing as a bar fight with no rum. The top and bottom lines both missed the mark and they've slashed their full year guidance like a pirate cuts a rope. 'Why is the rum gone?' one might ask. Well in this case it's the profits that have vanished! CEO Brian Cornell is blaming it on declining consumer confidence and those pesky tariffs. Sounds like someone needs a good ol' Captain Jack Sparrow charm to turn things around savvy?

Is the Tide Turning on American Spending?

Now I’m no soothsayer but even I can see that something's amiss. Target's woes could be a sign that the good ol' American consumer is tightening their purse strings. That's a bit concerning considering they fuel more than two thirds of the U.S. economy. JPMorgan's data suggests a slowdown in spending and that's as unsettling as a kraken sighting on a calm day. Spending habits below expectations? Not good not good at all.

Chase the Data Not the Kraken!

According to some bloke at JPMorgan Richard Shane their Chase data shows a distinct lack of enthusiasm when it comes to spending those doubloons. Spending fluctuations are as wild as a storm at sea with far more days below expectations than above. It's enough to make a pirate reconsider his life choices... almost!

Target's Stock Takes a Plunge: Down More Than 31%!

The markets don't seem overly concerned – yet. However Target's stock has taken a tumble. It's down more than 31% this year which is almost as bad as being marooned on a deserted island with no rum. Some folks at UBS are saying that the market might be underestimating the risks from those tariff reversals. Could be some turbulence on the horizon savvy?

Is It Just Target or Is the Ship Sinking?

Some say that Target's problems are unique to Target which is like saying the Black Pearl is just another ship. Wells Fargo chappies pointed out that Target has underperformed. Perhaps it is not consumer sentiment but Target's failure to address consumer demands. Some argue falling gas prices are to blame for the slowdown but when one of the biggest landlubber retailers reports a sales decline it's time to pay attention. It might be time to batten down the hatches and brace for squalls!

Consumer Sentiment: More Important Than a Parrot's Opinion?

So what's the takeaway? It seems investors might need to start taking consumer sentiment more seriously. These days data points are worth more than a chest full of treasure. Keep an eye on the consumer savvy? And always remember: 'Not all treasure is silver and gold.' Sometimes it's simply a good earnings report. Now where's that rum?