Enter multiple symbols separated by commas

Analyst Watch: Target, BJ's Will Avoid Big Box Retail Blues

U.S. stock index futures pointed to a lower open Wednesday in the wake of a strong close for the major averages in the previous session.

Here's what analysts and others are watching before the bell:

Target posted higher quarterly earnings Wednesday morning, helped by sales of more profitable items like clothing and improved profit at its credit card business.

Peter Benedict, retail analyst with Robert W. Baird, has an outperform rating and $64 price target on Target , which remains a top pick for him.

The firm will continue to highlight Target as a balanced idea on improved discretionary spending, he says, and expects company-specific initiatives to support positive comps in the second half of 2010 despite tougher compares.

"We remain encouraged by continued positive traffic and strong comps within higher-margin apparel category," Benedict says. Also, strong credit profitability is expected, he says, while year-over-year revenue declines are expected to
persist, continued downward trend in delinquencies sets the stage for continued release of bad debt provision.

Meanwhile, Benedict is keeping his neutral rating and $48 price target on BJ's Wholesale .

"We expect an in-line quarter from BJ,with below-plan merchandise comps (2.9% vs. 4%-6% guidance) mitigated by lower-than-expected IT expenses," Benedict says.
Traffic, he notes, remains strong and average ticket
pressures should ease in the second half.

"While fundamentals have slowed and shares are no longer 'cheap,' private equity interest should limit downside risk," he says.

See more of what analysts and money managers have to say, and get the latest financial news. Watch Squawk on the Street every weekday morning starting at 9 a.m. ET.


Your Daily Dashboard

Pre-Markets Data | First Trade for Wednesday| Wednesday Outlook

Analyst Interviews | CNBC Stock Blog | Dow 30 Stocks—In Real Time


Disclosure: Disclosure information was not immediately available.



Contact Squawk on the Street

  • Carl Quintanilla

    Carl Quintanilla is an Emmy-winning reporter and co-anchor of CNBC's "Squawk on the Street," broadcast live from the NYSE.

  • Simon Hobbs

    Simon Hobbs co-anchors the 10 a.m. hour of CNBC's "Squawk on the Street" live from the New York Stock Exchange.

  • Jim Cramer

    Jim Cramer is host of CNBC's "Mad Money" and co-anchor of the 9 a.m. ET hour of CNBC's "Squawk on the Street."

  • David Faber

    “Squawk on the Street” Co-Anchor

  • Rick Santelli

    Rick Santelli joined CNBC Business News as an on-air editor in 1999, reporting live from the floor of the Chicago Board of Trade.