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00:00It feels like Joe from my perspective and others to look it in. They're struggling to find the right balance. These companies have gone from being understaffed to overstaffed undersupplied to oversupplied supplied. And Joe all of a sudden this all this inventory and they don't know what to do with it. So how do you find the right balance in an economy moving this fast. Yeah I and I think that's really the challenge. And something actually Doug McMillon talked about yesterday was the speed of all of this that it's really hard to adjust to the business that quickly to place and catch up. Obviously the consumers moving and changing quite rapidly. And I think you're right. I think that you know the the retailers we saw this with Amazon to where they kind of were building out the capacity that they needed at the time during the height of the pandemic. And now you're seeing some of the give back. What's really interesting here is if you go back in history chart Target's gross margin has pretty been very stable and right around 28 percent. Obviously this quarter it really dropped a lot to 25 and a half percent. And their guidance for the year would imply that it's going to be certainly well below the 28 maybe more like 25 26. I think that's transitory. And I know the stock's down a lot right now. And but if you kind of really look closely at that line item and look at the way they're operating the rest of the business there's a lot of pressures right now on the supply chain on fuel costs. Yeah. And on everything that's just hurting the business right now.

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Target's Profit Forecast Cut Is 'Transitory': Telsey's Feldman

Joe Feldman, assistant director of research at Telsey Advisory Group, says increased costs and supply chain pressures are behind Target Corp.'s "transitory" margin shortfall. "Target's gross margin has pretty been very stable, right around 28% -- this quarter it really dropped a lot to 25.5%. I think that's transitory," Feldman says on "Bloomberg Surveillance." (Source: Bloomberg)

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