NEW YORK (AP) — Standard & Poor's Ratings Services lowered its rating on Target Corp. following weaker-than-expected fourth-quarter results that were dragged down by a massive data breach and a disappointing foray into Canada.
The rating agency said Friday that it lowered its ratings one notch down to "A'' from "A+." The rating is still four grades above speculative or junk status. S&P says the outlook is still "Stable," implying further changes are not imminent.
"The downgrade reflects our expectations for limited recovery of credit metrics given continued operating losses at the Canadian division as well as potential costs related to the data breach," said S&P's credit analyst Ana Lai.
The move comes more than a month after the nation's second-largest discounter reported its fourth-quarter profit fell 46 percent on a revenue decline of 5.3 percent as the breach scared off customers worried about the safety of their personal data.
Target expects business to be muted for some time: It issued a profit outlook for the current quarter and full year that missed Wall Street estimates because it faces hefty costs related to the breach.
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