Macy's (M) Announces Quarterly Earnings Results

Macy's (M) Upgraded to Positive by OTR Global

Macy's (M) Upgraded to Positive by OTR Global

The company's stock rose almost 10% in premarket trading as Macy's blew away many estimates.

Net sales in the first quarter totaled $5.541 billion at Macy's, an increase of 3.6 percent, compared with sales of $5.350 billion in the same quarter a year ago. At 48 cents, the company's earnings per share were 12 cents higher than the FactSet consensus of 36 cents. The company said that it had $0.48 in earnings per share (EPS) on $5.54 billion in revenue, which compares with consensus estimates from Thomson Reuters of $0.35 in EPS on revenue of $5.39 billion. All three of the parent company's sub-brands - Macy's, Bloomingdale's, and Bluemercury - posted strong results, he said, calling out the customer response to Bloomingdale's new 40,000-square-foot shoe floor.

Gennette, who took over for longtime Macy's CEO Terry Lundgren in March 2017, added that consumer spending remained "healthy" and that there were "significant improvements in global tourism".

A number of large investors have recently bought and sold shares of M. American International Group Inc. lifted its stake in Macy's by 98.9% during the fourth quarter. Following the sale, the chief financial officer now directly owns 67,515 shares in the company, valued at $1,984,265.85. Ltd now owns 4,067 shares of the company's stock valued at $120,000 after buying an additional 1,787 shares during the period.

The retailer's momentum reflects Macy's healthier inventory and willingness to experiment-for instance, with new concept stores like Macy's Backstage, its off-price business. Its online sales increased by a double-digit percentage during the first quarter alone. Also apart from asset sale gains, net income for the first quarter of 2018 totaled $131 million, or 2.4 percent of sales, contrast to $38 million, or 0.7 percent of sales, in the first quarter of 2017. Net cash used by financing activities in the first quarter of 2018 was $99 million, contrast with $273 million a year ago. Zacks Investment Research raised Macy's from a "hold" rating to a "buy" rating and set a $28.00 target price for the company in a research report on Wednesday, January 10th.

Excluding impairment and other one-time costs, Macy's earned $0.48 per share, $0.11 higher compared with what analysts had anticipated. The company said it is ending a joint venture with China's Fung Retailing that began in 2015. Sales, earnings, and cash flow all came in ahead of what the company predicted, prompting the retailer to raise its outlook for the rest of the year. Instead, Macy's will remain on Alibaba's (NYSE: BABA) TMall platform and focus efforts there. Sales are expected to range from a 1% decline to a 0.5% increase from $24.8 billion previous year compared to the prior call for a decline of 0.5% to 2%. Comparable sales on an owned basis are predictable to be 20-30 basis points below comparable sales on an owned plus licensed basis.

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