In research notes shared via email with The Epoch Times following the fourth-quarter earnings for Target Inc., Ross Stores Inc., and Best Buy, Bank of America’s Global Research team lowered their yearly outlook for all three retailers owing to tariff concerns and inflation-wary consumers.
Target’s fourth-quarter earnings were well above Wall Street’s expectations of $2.24 per share and revenue of $30.82 billion. Same-store sales, a key financial metric for store growth, align with analysts’ expectations. In the company’s 2026 guidance, Target expects earnings of $8.80–9.80 per share versus analysts’ expectations of $9.24 per share.
In highlighting Target’s top-line results, Bank of America analyst Robert Ohmes lowered his full-year estimate for the Minneapolis-based retailer to $9.10 per share, reflecting weak February sales, outsized profit pressures in the first quarter from new store startup and remodel costs and tariff uncertainty.
While pleased with the retailer’s quarterly results, Ross CEO Jim Conroy said the California-based discount merchandiser remained cautious looking ahead due to unseasonable weather and volatility in the global economy that negatively impacted customer traffic. The company’s annual guidance expects earnings from $5.95–6.55 per share, well below analysts’ expectations of $6.69 per share.
Following Ross’s fourth-quarter report, Bank of America analyst Lorraine Hutchinson lowered her yearly earnings estimate to $6.34 per share but reiterated that the retailer was still a good stock buy for investors.
“This creates a difficult setup for [our] first-quarter guidance, but volatility typically leads to great closeout buys,” Hutchinson told The Epoch Times via email.
For fiscal year 2026, Best Buy now expects earnings per share of $6.20 to $6.60 on revenue of $41.4–42.2 billion. Analysts expected the Minnesota retailer to post earnings per share of $6.58 on revenue of $41.8 billion.
Bank of America’s Ohmes lowered Best Buy’s 2026 guidance to $6.25, down from his previous outlook of $6.50 per share. “The lower end of the guidance [reflects] uncertainty around tariffs and the consumer,” said Ohmes.
To close out the busy week, Costco Wholesale and Macy’s Inc. posted mixed fourth-quarter and year-end results and offered tepid outlooks for the remainder of 2025.
In Thursday’s session on the Nasdaq, Costco shares fell 2 percent, trading after the Washington State warehouser missed Wall Street’s profit and sales expectations. However, Bank of America maintains its “strong buy” recommendation for the big-box retailer as the company’s core inventory will continue to drive traffic and non-food sales to local membership clubs, Ohmes said, adding that Costco is less reliant on key imports from China, Mexico, and Canada than its competitors.
“We reiterate ‘Buy’ and expect Costco to gain share in the current environment as consumers continue to adjust to higher prices, making Costco value proposition more attractive,” Ohmes told The Epoch Times in his March 6 research note.
At Macy’s, company CEO Tony Springer joined the long line of chief executives at Walmart, Target, Best Buy, and other bellwether retailers, lowering their 2025 outlooks based on tepid consumer spending and uncertainty regarding tariffs.
For the quarter ended Feb. 1, Macy’s posted adjusted earnings of $1.80 a share, topping the $1.55 analysts anticipated. Net sales were reported at $7.77 billion, representing a 4.3 percent decline from the previous year. They were marginally below the analysts’ estimates of $7.78 billion.
For the full year, the parent company of Macy’s and Bloomingdale’s department stores adjusted outlook now expects earnings of $2.05 per share to $2.25 per share, below analysts’ estimates of $2.29 per share.
“We will closely monitor sell-throughs and thoughtfully make adjustments that reflect our demand throughout the year,” said Turner.
