Target - Corporate earnings season resemblant of the bear market
Yesterday, Target announced its earnings for the third quarter of 2022. The report outlined softening sales and profit trends with downgraded guidance going forward. Total revenue and cost of sales increased year over year, while net earnings and EPS fell dramatically for that same period. Subsequently, shares of Target fell more than 13% in the pre-market trading. Target is yet another company that fulfills our prediction about a weak corporate earnings season and progression into the second phase of the bear market. We expect this trend to worsen in the next earning season and further enforce our thesis.
Total revenue = $26.518 billion (+3.4% YoY)
Cost of sales = $19.680 billion (+8.1% YoY)
GAAP Earnings per share = $1.54 (-49.3% YoY)
Operating income = $1.022 billion (-49.2% YoY)
Net earnings = $712 million (-52.1% YoY)
Illustration 1.01
The image above shows the daily chart of Target. Yellow arrows indicate previous earnings reports and subsequent price action.
Technical analysis - daily time frame
RSI and Stochastic reversed to the downside. MACD flattens, and if it breaks below 0 points, it will bolster the bearish case. DM+ and DM- performed a bearish crossover. Overall, the daily time frame is bearish.
Technical analysis - weekly time frame
RSI, MACD, and Stochastic show signs of exhaustion. DM+ and DM- are bullish. Overall, the weekly time frame is bearish.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Total revenue = $26.518 billion (+3.4% YoY)
Cost of sales = $19.680 billion (+8.1% YoY)
GAAP Earnings per share = $1.54 (-49.3% YoY)
Operating income = $1.022 billion (-49.2% YoY)
Net earnings = $712 million (-52.1% YoY)
Illustration 1.01
The image above shows the daily chart of Target. Yellow arrows indicate previous earnings reports and subsequent price action.
Technical analysis - daily time frame
RSI and Stochastic reversed to the downside. MACD flattens, and if it breaks below 0 points, it will bolster the bearish case. DM+ and DM- performed a bearish crossover. Overall, the daily time frame is bearish.
Technical analysis - weekly time frame
RSI, MACD, and Stochastic show signs of exhaustion. DM+ and DM- are bullish. Overall, the weekly time frame is bearish.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
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