Forbes says that Wall Street is starting to be concerned about Target because of an increase in the amount of delinquencies in its credit card operation. Uh oh…
Target has 25% of its stores in areas that have been slammed by the subprime meltdown, and the percentage of its customers who are not paying their credit card bills on time is um, kinda high…
“Target has 25 percent of its stores in states that have experienced excessive mortgage delinquencies compared to the national average,” PiperJaffray analyst Jeffrey P. Klinefelter wrote in a client note.
G.E. which runs the private label credit cards for Walmart, IKEA and Lowe’s wants to sell the (still profitable) division, but isn’t having much luck as delinquencies rise and the pace of consumer spending slips, according to the New York Times.
Meanwhile, another report suggested that consumers will see lots more store closings in regional malls due to crappy sales and a weak back-to-school season.
Target declines as analyst downgrades it to ‘Hold’ [Forbes]
Fitch: Regional malls may see more store closings [BusinessWeek]
(Photo: CyberCJH )