Retail Stock Poised to Pop After Earnings

Target reported top- and bottom-line wins for the fourth quarter

Target Corp (NYSE:TGT) is 9.7% higher before the bell, after the retailer reported fourth-quarter earnings and revenue that beat Wall Street’s estimates. The company saw profits of $2.98 per share on $31.92 billion in revenue, and announced a new membership program. On the other hand, Target’s comparable sales declined for the third-straight quarter, and it forecasted another year of declining sales.

Today’s premarket gains have TGT on track to open above $164, its highest trading level since May. Shares are also set to blast past the $156 level that rejected a series of higher highs that began after a post-earnings bull gap in mid-November, and could erase a 9.3% year-over-year deficit.

Options traders were more bullish than usual ahead of the event. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Target stock sports a 50-day put/call volume ratio of 1.95 that stands higher than 91% of annual readings.

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