Target is latest to report that it had a holly, jolly holiday season

Shoppers gave Target a gift this holiday season, boosting the big box retailer's sales and giving it a tailwind that has led the company to raise its financial forecast for not only the quarter but the full year.

Increased purchases of items ranging from groceries to clothing led to Target's overall sales rising 3.4% in the last two months of 2017 - a significant leap over its earlier prediction of a 0% to 2% uptick.

The strong holiday performance has led Target to raise its earnings forecast for the fourth quarter to between $1.30 to $1.40 per share, up from the previous range of $1.05 and $1.25.

>> If you think grocery stores are playing tricks on you, they really are

It also boosted its overall earnings expectations for 2017 to between $4.64 and $4.74 a share, up from an earlier projection of $4.40 to $4.60.

Investors seemed pleased, with the store chain's stock price rising 2.96% to $69.16 per share in pre-market trading.

"We are very pleased with our holiday season performance, which reflects the progress we've made against our strategy throughout the year,'' Brian Cornell, Target's chairman and CEO said in a statement.

Target is the latest retailer to reap the bounty from a holiday season that paid off for the entire industry as U.S. sales rose 4.9%--the biggest bump in six years according to Mastercard SpendingPulse.

Macy's reported that sales in locations open at least a year ticked up 1.1%, and online sales spiked by double digits, while J.C. Penney reported a 3.4% sales bump during the season.

>> Amazon will buy Target this year, analyst predicts

Like many retailers who ramped up events and conveniences to entice shoppers during the all important holiday shopping period, Target offered free shipping, weekend deals and even hot cocoa and cookies to woo customers. It also made eight of a dozen new, exclusive brands available during the season, including Hearth & Hand with Magnolia, a home-goods collaboration with Chip and Joanna Gaines, the popular hosts of the TV show Fixer Upper.

But at a time when shoppers increasingly shop online and look first to e-commerce giant Amazon, even a successful holiday season has not been enough to save some struggling storefronts.

Macy's, which said in August, 2016 that it would be closing 100 stores, announced seven of those locations last week. So far, it has revealed 81 of the storefronts that will be going out of business, and those closures, coupled with a paring back of staff at some locations that will remain open, will result in the elimination of 5,000 jobs.

>> Which gift cards are worth the most money?

Meanwhile, more than 100 Sears and Kmart stores will shut their doors in March and April. Liquidation sales will start Friday and when the closings are complete, 39 Sears stores in 22 states and 64 Kmart stores in 29 states will be out of business. J.C. Penney previously said it planned to shutter 138 department stores.

In November, Target said it would close 12 stores by Feb. 3, to wean under performers even as it expanded its footprint with new, more curated locations on college campuses and in urban centers. It opened 32 new stores last year, creating 2,000 jobs.

Neil Saunders, managing director of GlobalData Retail, said in a note that the retailer's performance could be strengthened by improving the presentation of products in its stores.

"While Target's holiday growth is respectable and makes it a holiday winner, we believe that performance should and could have been better,'' Saunders wrote. "Target needs to make stores more compelling so that those customers collecting items in shops browse and buy more while doing so."

About the Author