Target increases guidance after impressive second quarter

Target announced Wednesday it had earned $1.23 per share in the second quarter of the year on reported revenues of $16.43bn, a 1.6% increase.

Target said more shoppers had returned to its traditional brick-and-mortar stores, leading the discount retailer to raise its outlook for 2017 as its turnaround efforts were starting to bear fruits.

"We are pleased that second-quarter traffic increased more than 2 percent, reflecting growth in both our store and digital channels," chief executive Brian Cornell said in a statement.

"We continue to focus on our long-term strategy [...] While our recent results are encouraging, we will continue to plan prudently as we invest in building our brands, our digital channel, the value we provide our guests and elevating service levels in our stores."

The rise in existing store sales almost doubled analysts' expectations, increasing by 1.3%, as digital revenues increased by an impressive 32%.

"This continues to be a challenging, competitive environment, that's why we're particularly pleased by the ongoing progress we saw on the second quarter," chief marketing officer of Target, Mark Tritton said on Wednesday's earnings conference call.

For 2017, Target updated its earnings forecast to between $4.34 and $4.54 per share. Analysts polled by Thomson Reuters had called for earnings per share of $4.39, falling on the lower end of Target's updated range.

As of 1415 BST, Target shares were gaining 3.55% to $56.28.