Advertisement
Canada markets closed
  • S&P/TSX

    22,167.03
    +59.95 (+0.27%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • DOW

    39,807.37
    +47.29 (+0.12%)
     
  • CAD/USD

    0.7386
    +0.0014 (+0.18%)
     
  • CRUDE OIL

    83.11
    +1.76 (+2.16%)
     
  • Bitcoin CAD

    96,001.34
    +2,411.32 (+2.58%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • GOLD FUTURES

    2,254.80
    +42.10 (+1.90%)
     
  • RUSSELL 2000

    2,124.55
    +10.20 (+0.48%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • NASDAQ futures

    18,465.00
    -38.75 (-0.21%)
     
  • VOLATILITY

    13.01
    +0.23 (+1.80%)
     
  • FTSE

    7,952.62
    +20.64 (+0.26%)
     
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     
  • CAD/EUR

    0.6844
    +0.0039 (+0.57%)
     

Here's why Cramer calls retail giant Target the 'Donner Party'

Here's why Cramer calls retail giant Target the 'Donner Party'

Target (NYSE: TGT)'s lowered fourth-quarter sales and earnings outlook on Wednesday reveals its online growth is eating into the company's in-store sales, CNBC's Jim Cramer said.

Cramer said Target's "incredible growth" online of more than 40 percent in December snuffed the company's brick-and-mortar.

"Target — mark my words — it is the Donner Party. Total cannibalization of themselves," Cramer said on " Squawk on the Street " on Wednesday, referring to a group of pioneers in the 1800s who became trapped in the Sierra Nevada Mountains and resorted to cannibalism to try to survive.

The retail giant lowered its comparable store sales and earnings forecasts for the quarter, and cut its full-year 2016 outlook, citing softer-than-expected holiday sales.

ADVERTISEMENT

Target Chairman and CEO Brian Cornell said in a statement the company's December digital sales growth was offset by "early season sales softness and disappointing traffic and sales trends" in its stores.

"They're using the dotcom and the dotcom is killing the brick-and-mortar," Cramer said. "We saw this in Urban Outfitters (NASDAQ: URBN). That was the first one you realize, holy cow, they're getting killed by themselves."

The main takeaway is people are shopping at Target, but they're not going to Target, Cramer said. He said Target's latest forecast is a sign to investors to get out of retail.

—Reuters contributed to this report.



More From CNBC

  • Top News and Analysis

  • Latest News Video

  • Personal Finance