NEW YORK (AP) — Solid holiday sales and improvements in its branded credit card business helped Target’s fourth-quarter profit rise almost 11 percent, but a company official cautioned Thursday that the economy is a “wild card.”

The discounter said two major initiatives — offering more food and giving shoppers a 5 percent discount if they use Target’s branded cards — would help drive a key measure of revenue growth for this year to its highest level in several years.

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And Target is forecasting strong growth overall. It expects its revenue to top $100 billion in six or seven years, compared with $67 billion last year, and it expects its earnings per share to double in that period.

But high unemployment and rising retail prices mean the U.S. retailing market “is not enjoying robust growth,” CFO Doug Scovanner said during a conference call with analysts Thursday.

“The wild card is what happens to the U.S. economy,” Scovanner said. “We are more confident … in our strategies.”

The company forecast lower earnings for fiscal 2012 than Wall Street was expecting, but investors appeared to focus on the long term. Target shares rose almost 3 percent, or $1.42 per share, to $51.68, staying near the low end of their 52-week range from $48.23 to $60.97.

For the quarter that ended Jan. 29, Target reported net income of $1.03 billion, or $1.45 per share. That’s up 10.5 percent from $936 million, or $1.24 per share, in the same period last year. Target said its earnings included an income tax benefit of 7 cents per share for the quarter and 14 cents per share for the year, but it did not offer adjusted earnings figures.

Total revenue rose 2.4 percent to $20.66 billion.

Analysts were expecting adjusted earnings of $1.39 per share on revenue of $20.7 billion, according to FactSet.

Target said its revenue at stores open at least a year also rose 2.4 percent for the quarter. The comparison –considered a key long-term gauge because it excludes stores that recently opened or closed — fell early in the recession but resumed rising in late 2009.

The retailer’s expanded food selection has helped bring in more customers. The discount for those paying with Target’s branded credit or debit cards, which began in October, also boosted sales.

Target said the dollar amount of the average customer’s purchase rose only 0.8 percent for the latest quarter, but more customers bought things and they made 1.6 percent more transactions.

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The selling price per item fell 2.7 percent, and Target’s gross margin slipped to 28.7 percent from 29.1 percent. The profit margins shrank because of the food expansion and the 5 percent discount, some analysts said. In general, groceries, which have a notoriously slim profit margin, now make up a larger share of Target’s offerings.

Target should restrict the card discount, Wall Street Strategies analyst Brian Sozzi said, instead of offering it across the store.

“I see a building pipeline of margin pressures,” he said.

Target said in January that it agreed to acquire most leases of Canadian retailer Zellers for $1.85 billion and plans to open its first stores outside the U.S. in 2013 in Canada. It reiterated its plan to open 100 to 150 stores there in 2013 and 2014.

Target also said in January that it will try to sell its credit card business, where quarterly profit increased to $151 million, compared with $39 million, as bad debt expense declined to $83 million, from $284 million in the same period last year. The unit produced $1.6 billion in revenue for the year, down 16.5 percent from the year before.

For the full year, Target said it earned $2.92 billion, or $4 per share, compared with $2.49 billion, or $3.30 per share, in the fiscal year that ended Jan. 30, 2010. Its revenue rose 3.1 percent to $67.39 billion.

The company said Thursday that it expects full-year revenue at stores open at least a year to rise by 4 percent to 5 percent, much higher than last year’s rate of 2.1 percent.

For fiscal 2012, the company it expects its earnings per share to rise 10 percent. That would amount to $4.24 per share, below the $4.36 per share that analysts were forecasting, according to FactSet.

Target’s results stand in stark comparison to those of Wal-Mart Stores Inc. For the past year, Wal-Mart has seen fewer customers coming in the doors as they shop at other rivals like Target.

Wal-Mart Stores Inc. reported Tuesday that its quarterly net income rose 27 percent. But it saw a 1.8 percent drop in revenue at its Walmart stores in the U.S. that had been open a least a year, the seventh quarterly decline in that key comparison.

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