Third-quarter comparable sales, missing results; shares down

(Reuters) – Target Corp (TGT.N) posted weak third-quarter results and sales on Tuesday, as the strong economy boosted consumer spending from competing retailers, resulting in a 7% drop in pre-market shares .

Sales at stores that have been open for at least a year increased by 5.1%, which is lower than analysts' estimates, which show an increase of 5.21%, according to Refinitiv's IBES data.

Profits fell short of expectations as lower prices, higher salaries and investments in its online business slashed margins. Excluding special items, Target achieved net earnings of $ 1.09 per share during the quarter, below the average estimate of $ 1.12 per share.

The retailer remains confident of being able to reach its profit outlook for the previous year, hoping that its investments will help it cope with the formidable online business Amazon.com Inc. (AMZN.O) and traditional rivals like Walmart Inc. (WMT.N) during the holiday season.

Target will offer a free two – day delivery on hundreds of thousands of items until December 22, with no minimum order or membership.

Sales reached 17.59 billion dollars, below the average estimate of 17.8 billion dollars.

Its third quarter performance comes after the release of the best growth in its comparable business figure in 13 years in the second quarter.

Target's shares fell 7.1% to $ 72.25 in pre-market trading.