The future of finance comes to New York
Incoming Target CFO John Mulligan and outgoing CFO Doug Scovanner participated in a Target sponsored meeting last Friday at the New York stock exchange. The event gave Wall Street analysts an opportunity to get to know Mulligan, and the consensus is the guy is a strong replacement for longtime CFO Scovanner whose tenure ends March 30.
That was the view of Bernstein Research analyst Colin McGranahan who indicated he expected as much from a Scovanner-run finance organization as the longtime CFO had a reputation for not suffering fools lightly. Scovanner first approached CEO Gregg Steinhafel and the board two years ago to work out his retirement and transition plan, at which point Mulligan, who had been loaned to the human resources organization for the prior two years, was brought back to the finance organization to run the treasury department and was identified as one of a number of potential internal candidates, according to McGranahan.
“The board also ran a global external search, but clearly Mulligan was well vetted and demonstrated the requisite capabilities and leadership to earn the role,” the Bernstein analyst said. “We think this long-running process should reassure investors and help quell concerns around management turnover at Target.”
Those concerns are understandable given the string of senior level departures that began last fall, but despite the loss of some high level talent, Mulligan and Scovanner assured those in attendance at the New York event the company can deliver on some ambitious long range targets.
“Both incoming and outgoing CFOs were upbeat on the long-term earnings potential of the company, including its ability to achieve $8 in earnings per share by 2017,” said Citigroup analyst Deb Weinswig. “Management believes that Canada, continued store growth in the U.S., and multichannel growth will drive topline sales and generate strong free cash flow, which the company plans to return to shareholders in the form of dividends and share repurchases.”