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Target has terrible holiday and warns of awful 2017

America's top retailers in trouble

Tar-jay is no longer in style.

Target missed the bullseye badly during the holidays, reporting earnings that were below forecasts. And the company's outlook for this year was much worse than expected, sending the stock down 13% in early trading. Shares are down 20% this year.

The terrible numbers from Target (TGT) are just another sign of how tough it is for traditional retailers to compete against the online juggernaut that is Amazon (AMZN, Tech30).

"Our fourth quarter results reflect the impact of rapidly changing consumer behavior, which drove very strong digital growth but unexpected softness in our stores," said Brian Cornell, chairman and CEO of Target.

To Target's credit, the company has embraced e-commerce. Target said digital sales were up 34% from a year ago.

That's higher than Amazon's overall sales growth during the holidays and even outpaced the 29% jump in online revenue growth that Walmart (WMT) posted in the fourth quarter.

The problem is that online sales are not growing quickly enough to offset the sales declines in Target's physical stores. Target said overall revenue fell more than 4% from a year ago.

Part of that was because of Target's decision to sell its in-store pharmacies to CVS (CVS) in late 2015. But revenue was down at Target even after factoring in the absence of pharmacy sales...


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