TJX - Execution inventory issues tell the tale in retail
Target’s (NYSE:TGT) surprise announcement of additional markdowns to come as it seeks to offload excess inventory and cancel orders is yet another indication of inventory issues playing out across much of the retail space. In an announcement on Tuesday morning, the retailer indicated it will invest to shore up supply chain issues and take significant pricing actions to move items off its shelves. Unfortunately, this action will trim operating margins to a range of 2% for the second quarter, well below the 6.5% expected by analysts. Importantly, many of these expectations were already cut in light of Target’s recent earnings disappointment. Yet, Target (TGT) is far from alone in falling lower on Tuesday as its inventory issues are far from unique. Indeed, its issues alongside fellow execution-focused retailer Walmart (NYSE:WMT) have helped lead much of the retail space lower. The presumption being that, if Target and Walmart are having issues
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Execution, inventory issues tell the tale in retail