In the MD&A section of the Target Corporation contain various interesting things. One interesting note is that in the financial year 2018, the company earned an increased revenue of 3.6%. This increase was noted to be obtained through the sales increase in that year, as well as the sales from the new stores that the corporation had set up. Notably, the company aimed at opening 35 new stores in that fiscal year, and the stores would focus on small format stores operations. In 2017, the company opened 32 new stores, some of which were in Chicago, New York, Minneapolis, Los Angeles, and Philadelphia (Target Corporation, 2019). The opening of new stores became one of the successful expansions that the company invested in; this was a good trend for Target since it implied that the expansion project was successful and it showed that the company had the capability of operating and a broader market.
The other interesting thing in the MD&A section of the Target Corporation is the method that the company uses to report after-tax ROIC form the continuing operations. From the discussion, the company believes that this method offers a reasonable measure of its capital allocation effectiveness over time. This method is advantageous to Target Corporation since it helps it to determine the durability of its competitive advantages (Crosson, 2013). Specifically, the company will be able to remain relevant in the market by tracking its ROIC over the financial years.
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The third interesting thing about Target Corporation is that its operating cash flow from the continuing operation decreased in 2018 to $5,970 million from $6,861 million in 2017. The decrease was linked to a significant increase in 2018 inventory as compared to the inventory in the previous year. The increase in inventory in 2018 was good for the company since it enables the company to raise its sales in 2019 fiscal year, which will, in turn, bring about higher revenues.
References
Crosson, S. V. (2013). Managerial Accounting . Boston, MA: Cengage Learning.
Target Corporation. (2019, March 13). Target Corp (TGT) 10-K Annual Report Wed Mar 13 2019. Retrieved from https://last10k.com/sec-filings/tgt/0000027419-19-000006.htm#sF9DDA354ECF6512281F5977F0934C567
