UPDATE 2-Target profit pinched by weak U.S. sales, Canadian expansion
(Adds investor quote, Canadian details, byline, updates stock price)
By Phil Wahba
Nov 21 (Reuters) - Discount chain Target Corp on Thursday blamed what it called "constrained" U.S. consumer spending for a tepid rise in quarterly comparable sales, and lowered its full-year profit forecast as a Canadian expansion proved costlier than expected.
Shares fell 3.7 percent to $64 in premarket trading.
Target competes most directly with Wal-Mart Stores Inc and other discount retailers, which have all ramped up their promotions to win over reluctant U.S. shoppers.
Last week, Walmart U.S. reported a small decline in comparable sales for its third quarter, and forecast no growth for the current quarter. It is starting holiday season sales earlier than ever to stave off rivals.
"It is challenging for retailers because things are OK out there, they're not good," said Shawn Kravetz, president of investment firm Esplanade Capital, which owns Target shares. "So retailers are getting more aggressive. Everything's a bit tighter."
An Ipsos poll for Reuters last week found more Americans were planning to spend less this holiday season than last year, and demanding big bargains.
Target's third-quarter comparable sales were up 0.9 percent, while analysts estimated a rise of 1.3 percent, according to Thomson Reuters I/B/E/S. Overall revenue rose 4 percent to $17.26 billion, below the Wall Street target of $17.36 billion. Continued...