Target (TGT) is sinking 5.5% after the giant retailer reported stronger-than-expected fourth-quarter results but provided lower-than-expected comparable-store sales guidance.

Additionally, TGT warned that negative macroeconomic catalysts would put downward pressure on its profits in the first quarter and noted that consumer spending trends were starting to weaken.

A woman purchasing groceries at a Target store, with a cart full of products.

The Highlights of Target's Q4 Results and Outlook

The giant retailer predicted that its comparable sales growth would likely be little changed during its current fiscal year. Analysts on average had predicted that its comparable sales would climb 1.7% during the latter period.

The company's Q4 revenue fell 3.1% to $30.9 billion but came in $90 million above analysts' average estimate. Moreover, TGT generated Q4 earnings per share of $2.41, excluding certain items, versus analysts' average estimate of $2.25.

Cautious Comments on the Macro Environment

 TGT's sales dropped last month versus the same period a year earlier, while consumers' confidence has declined and tariffs are causing "uncertainty," the retailer reported. TGT stated that these developments would put downward pressure on its profits going forward, although the firm added that warmer weather and upcoming "seasonal moments" would likely boost consumers' spending to some extent.

The Recent Price Action of TGT Stock

In the last month, the shares have fallen 15% while they're down 12% in the last three months.

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Disclosure: None. This article is originally published at Insider Monkey.