The second-largest U.S. retailer, Target Corp. (NYSE: TGT), said that its first-quarter profit jumped by 18 percent on Wednesday, beating analysts expectations and sending shares higher.
Net income at the discount retailer came in at $651 million, or 75 cents per share, up from the $554 million, or 63 cents per share during the same period last year. Total revenue increased 9.2 percent to $14.041 billion from $12.863 billion in 2006.
Analysts polled by Thomson Financial expected on average, first-quarter earnings of 71 cents a share on revenue of $14.17 billion.
Shares of Target rose $2.14, or 3.7 percent to $60.18 in early trading on the New York Stock Exchange.
Better store sales and expanded credit card operations helped drive up revenues, the company said in a statement.
Same-store sales for locations open for more than a year - a key industry metric - rose by 4.3 percent. Target's credit card sales rose 13 percent to $418 million, making up 3 percent of total revenue, compared with 2.9 percent a year earlier.
Credit card profit rose 20.6 percent to $143 million compared to a year ago on an increase in interest income.
Our overall performance reinforces our confidence in our ability to continue to generate profitable market share growth for the full year 2007 and many years to come, said Bob Ulrich, chairman and chief executive officer of Target .
Last week, Target's main competitor, Wal-Mart Stores (NYSE: WMT) reported first quarter earnings below Wall Street expectations and lowered its second quarter outlook.