profit revisions tend to recur!It is a cockroach theory…

The rule of thumb – you need to see at least 3-4 negative profit revisions before the negative wave peters out, and, occasionally, it might take a couple of fiscal years!Fortunately, since Target is such an old business – we have data since 1992 on their earnings.Have a look at the Chart for earnings for Target:historically, negative earning revisions (downward pointing arrows) clustered in bunches of 5-6!

Therefore, revisit the profit guide-downs from the last quarter – we will see more of them.