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Target trounced Walmart during the Holiday shopping season

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A big year-end boost from some of Target's "signature" categories capped a year of increased sales for the company, which has laid down a big challenge to its rivals.

The retailer said irs style, wellness, baby and kids sections all grew three times faster than the company average during the final months of 2015.

During that three-month stretch, traffic grew by 1.3 percent, helping lead to a comparable sales jump of 1.9 percent. Fortune magazine says Target "crushed" its main competitor Walmart, which only saw a 0.6 percent sales rise in the same period.

Digital sales in the fourth quarter increased 34 percent, while a downturn in electronics sales (caused by lower tablet sales) was more than made up for by good performance in its signature categories, significant growth in toys during the Holiday season, and sales boosts in food and apparel.

It caps off a year of growth for Target. Overall for 2015, the Bullseye's sales were up 2.1 percent and traffic in stores was up 1.3 percent.

It marks a huge turnaround for the Minneapolis-based retailer, which had struggled in the wake of the major data breach and its ill-fated expansion into Canada. This time two years ago Target was reporting a 46 percent fall in sales.

"As I look back to a year ago, I think we're operating on a much stronger foundation today," CEO Brian Cornell said during a conference call. "We are very pleased with the progress we made throughout 2015."

Click here to see the full earnings report.

Strong Black Friday, Cyber Monday

Cornell said Target's strategy for Black Friday and Cyber Monday paid off handsomely, setting a new record for digital sales during that week and "shattering" its Cyber Monday sales after offering 15 percent off everything on its website.

A key aspect of the company's turnaround is its signature categories and Cornell said the decision to focus on these areas (fashion, baby, wellness, kids) has been proved shrewd by Wednesday's results.

Wellness has been a specific focus for the company in the past year. Fortune reported last fall on Target's health-conscious changes, including replacing some of the junk food at checkout with healthier options.

They're in the process of a fresh grocery revamp, rolled out grocery delivery, and ousted the pizza and hot dogs at some in-store test restaurants in favor of some healthier options.

The company also struck a deal with CVS, which is replacing the former Target clinics in stores.

Target employs nearly 30,000 people in Minnesota, according to economic figures – making it the fourth largest employer in the state (behind Mayo Clinic, the state itself, and the U.S. federal government).

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