Target shares fall; Credit Suisse concerned over credit card profitability

Tue. August 12, 2008; Posted: 11:29 AM

NEW YORK, Aug 12, 2008 (Thomson Financial via COMTEX) -- TGT | Quote | Chart | News | PowerRating -- Shares of Target Corp. fell Tuesday, as concerns raised by Credit Suisse regarding the discount retailer's credit card operations applied downside pressure.

The stock fell 2% to $50.22. The shares had gained 12% over the previous 2 sessions to close at the highest level since June 19.

Credit Suisse Analyst Michael Exstein said Target was set to implement a second set of revisions to the terms of its Target Visa card, just five months after the first set of revisions. He said the company usually groups term changes together in one notice to avoid expenses involved with informing cardholders.

"We view this set of changes as a warning that card profitability is continuing to deteriorate more substantially than management expected, and a sign credit card profitability will continue to be under pressure through the balance of this year," Exstein said in a research note. "Target's credit metrics have deteriorated substantially year to date, in excess of management expectations as disclosed at the beginning of the year." Tomi Kilgore tk1

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For full details on Target Corporation (TGT) click here. Target Corporation (TGT) has Short Term PowerRatings of 8. Details on Target Corporation (TGT) Short Term PowerRatings is available at This Link.

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