By Tomi Kilgore
Weeklong Black Friday deals to include up to 50% off toys and games after 'meaningful deceleration' in sales in October
Target's earnings woes spilled over to shares of toy makers Hasbro and Mattel after the retailer said it saw a sharp slowdown in toy sales in October.
Target Corp. (TGT) reported early Wednesday fiscal third-quarter earnings that missed expectations by a wide margin and guided for a surprise decline in same-store sales for the current quarter covering the holiday season.
That slowdown included the discretionary category of toys at a time when the holiday shopping season was getting under way.
"[W]e saw a meaningful deceleration in toys this quarter, most notably in October," said Target's Chief Growth Officer Christina Hennington in the post-earnings conference call with analysts, according to a FactSet transcript. "This is a trend we will continue to monitor closely as we move throughout the holiday season."
Hasbro Inc.'s (HAS) stock dropped 4.7% to close Wednesday at $55.97, the lowest close since March 2020. Mattel Inc.'s (MAT) stock shed 2.2% to $17.08, but was still above Monday's two-year closing low of $16.66.
Also read: Hasbro is making too many 'Magic: The Gathering' cards, analyst says in downgrading stock.
In comparison, the SPDR Consumer Discretionary Select Sector exchange-traded fund (XLY) fell 1.5% to $142.53 on Wednesday and the S&P 500 index lost 0.8% to 3,958.79.
Last month, Hasbro reported third-quarter profit that missed expectations while Mattel fell short on sales and lowered its full-year outlook.
With the toy-sales trends in mind, Target's Hennington said weeklong Black Friday deals will include prices of up to 50% off across the toys and games categories.
(END) Dow Jones Newswires
November 17, 2022 07:49 ET (12:49 GMT)
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