Target Corporation (TGT) announced its first quarter earnings report on Wednesday, May 20. Despite the retailer reporting better-than-expected revenue, the company’s shares fell by over 6% following the earnings release.

Target reported quarterly revenue of $25.44 billion. This was up from revenue of $23.85 billion in the same quarter last year and above analysts’ expectations of $24.64 billion.

“First quarter financial results were stronger than expected, providing encouraging early signs that our clarified strategy is resonating with our guests and driving broad-based growth across our business,” said Target CEO, Michael Fiddelke. “While we are pleased with our Q1 performance, our focus remains on building consistent, long-term growth, and we recognize there is much more work in front of us. As we look ahead, we are focused on staying disciplined and flexible in an uncertain operating environment and continuing to invest boldly in our team, capabilities, and an elevated guest experience to unlock our full potential over time.”

The company reported net income of $781 million for the quarter or $1.71 per adjusted share. This was a decrease from net income of $1.04 billion or $2.27 per adjusted share reported in the same quarter last year.

Target’s total comparable sales increased 5.6% in the quarter, resulting from an increase in comparable store sales of 4.7% and comparable digital sales growth of 8.9%. Target’s gross margin rate slightly increased to 29.0% compared to 28.2% last year. The increase was partly attributed to improved productivity, growth in advertising and lower markdown rates which were partially offset by higher production costs. Target updated its full-year 2026 guidance and expects approximately 4% net sales growth and adjusted earnings per share near the high end of its previously projected $7.50 to $8.50 range.

Target Corporation (TGT) shares ended the week at $125.60, up 3% for the week.

TJX Posts Earnings

The TJX Companies, Inc. (TJX) released its first quarter earnings report on Wednesday, May 20. The multinational off-price apparel and home accessories retailer delivered increased revenue, causing shares to rise by nearly 5% following the release.

The company reported first quarter net sales of $14.32 billion, up 9% from $13.11 billion reported during the same quarter last year. This exceeded analysts’ expectations of $14.02 billion.

“I am extremely pleased with our first quarter performance,” said TJX Companies CEO, Ernie Herrman. “Throughout the quarter, our teams around the globe successfully executed on our off-price fundamentals to deliver on our value mission and offer an exciting treasure-hunt shopping experience to customers, every day. Going forward, we are convinced that the flexibility and resiliency of our off-price business model will continue to be a tremendous advantage.”

For the first quarter, TJX reported net income of $1.33 billion or $1.19 per diluted share. This was up from $1.04 billion or $0.92 per diluted share reported in the same quarter last year.

The Massachusetts-based parent company of T.J. Maxx, Marshalls and HomeGoods reported an increase in comparable sales across all store segments, including an increase of 6% at Marmaxx and 9% at HomeGoods. During the first quarter, TJX opened 48 new stores for a total of 5,262. The company returned $1.1 billion to shareholders through share repurchases and dividends during the quarter. TJX expects diluted earnings per share to be between $1.15 to $1.17 for the second quarter and between $5.08 to $5.15 for the full fiscal year 2027.

The TJX Companies, Inc. (TJX) shares ended the week at $158.27, up 7% for the week.

Lowe’s Releases Earnings Report

Lowe’s Companies, Inc. (LOW) released its first quarter earnings report on Wednesday, May 20. While the home improvement retailer reported increased sales for the quarter, its shares fell by about 4% following the report’s release.

Lowe’s reported first quarter revenue of $23.08 billion, up 10% from $20.93 billion during the same quarter last year. Analysts expected revenue of $22.97 billion for the quarter.

“Strong spring execution and continued momentum in Pro, Appliances, Online, and Home Services supported a solid start to the year as we delivered our fourth consecutive quarter of positive comp sales,” said Lowe’s CEO, Marvin R. Ellison. “In spite of a challenging housing macro, we remain focused on advancing our Total Home strategy to provide the best experience for our customer. I would also like to thank our associates for their dedication to serving our customers throughout the busy spring season.”

Lowe’s reported quarterly net earnings of $1.63 billion or $2.90 per adjusted share. This was a slight decrease from net earnings of $1.64 billion or $2.92 per adjusted share during the same quarter last year.

The North Carolina-based home improvement retailer reported that its comparable sales increased 0.6% during the first quarter, which was driven by a 15.5% increase in online sales and continued strength in Home Services, Appliances and Pro sales. At the end of the first quarter, the company had a total of 1,759 retail stores representing nearly 200 million square feet of retail selling space. The company affirmed its outlook for full fiscal year 2026 and expects total sales of $92.0 to $94.0 billion total sales and diluted earnings per share to be in the range of $11.75 to $12.25.

Lowe’s Companies, Inc. (LOW) shares ended the week at $215.03, down 2% for the week.

The Dow started the week of 5/18 at 49,481 and closed at 50,580 on 5/22. The S&P 500 started the week at 7,415 and ended at 7,473. The NASDAQ started the week at 26,289 and finished at 26,344.

Treasury yields varied throughout the week as investors digested the minutes from the Federal Reserve’s latest meeting which revealed a possibility of an interest rate hike. Yields moved higher later in the week as the latest unemployment data showed the labor market remains resilient.

On Wednesday, the Federal Reserve released the minutes from the Federal Open Market Committee’s (FOMC) April meeting, where Fed officials agreed to keep interest rates unchanged at 3.50% to 3.75%. The minutes showed that policymakers were divided on the future path of monetary policy, with several officials concerned that persistent inflation could require future rate increases if inflation does not move back toward the Fed’s 2% target.

“A majority of participants highlighted, however, that some policy firming would likely become appropriate if inflation were to continue to run persistently above 2%. To address this possibility, many participants indicated that they would have preferred removing the language from the postmeeting statement that suggested an easing bias regarding the likely direction of the Committee’s future interest rate decisions,” the FOMC minutes said.

The benchmark 10-year Treasury note yield opened the week of May 18 at 4.60% and traded as high as 4.69% on Wednesday. The 30-year Treasury bond opened the week at 5.12% and traded as high as 5.20% on Wednesday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment fell by 3,000 to 209,000 for the week ending May 16, lower than economists’ expectations of 213,000 claims. Continuing claims increased by 6,000 to 1.78 million. 

"We still cannot rule out some spillover effects from the war and the spike in oil prices on to the labor market, which we have always expected would come with a lag," said senior U.S. economist at Oxford Economics, Matthew Martin. "But for now, we think the labor market is showing enough stability to allow the Fed to feel comfortable keeping policy steady."

The 10-year Treasury note yield finished the week of 5/18 at 4.56% while the 30-year Treasury note yield finished the week at 5.07%.

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, May 21. The survey showed mortgage rates climbing to their highest levels since August.

This week, the 30-year fixed rate mortgage averaged 6.51%, up from last week’s average of 6.36%. Last year at this time, the 30-year fixed rate mortgage averaged 6.86%.

The 15-year fixed rate mortgage averaged 5.85% this week, up from last week’s 5.71%. During the same week last year, the 15-year fixed rate mortgage averaged 6.01 %.

“The 30-year fixed-rate mortgage averaged 6.51% this week,” said chief economist at Freddie Mac, Sam Khater. “As rates fluctuate, aspiring buyers should remember that by shopping around for the best mortgage rate and getting multiple quotes, they can potentially save thousands.”

Based on published national averages, the savings rate was 0.38% as of 5/18. The one-year CD averaged 1.55%.

Editor’s Note: The publicly available financial information is offered as a helpful and informative service to our friends. This article is not an endorsement of any company, product or service.