Macy's Inc (NYSE: M), founded in 1858, is a department store chain falling under the consumer staple industry. Headquartered in Ohio, the United States, it is one of the nation's premier retailers operating in 44 states with ~690 departmental stores with the brand names Macy's and Bloomingdale's. Al Tayer Group LLC operates Macy's Bloomingdale's stores in Dubai and Kuwait under license agreements.
Yesterday, Macy's Inc had announced an update for the sales during November and December 2018 and updated FY18 guidance following which ~$34 billion was wiped off from the most significant US retailer market.
The S&P 500 retail index was down by 2.1% in the morning session which recovered to close 0.4% down, now trading at 2,080.46 points. Among the losers were Macy's Inc with a downfall of 17.66%, Victoria?s Secret owned L Brands which lost 4.4%, Kohl?s dropped 4.7% while JC Penney shed 4.5%.
During November and December 2018, the company reported a growth of 0.7% in comparable sales through its owned stores which were 3.9% in 1Q18, 1.9% in Spring, and 3.1% in 3Q18. It also reported an increase of 1.1% in comparable sales through its owned and licensed stores which was 4.2% in 1Q18, 2.3% in Spring, and 3.3% in 3Q18. The net sales guidance has been provided based on 52 weeks in 2018 compared to 53 weeks in 2017.
As per 2018 annual guidance provided on 27 February 2018, the company anticipated growth of flat to 1.0% in comparable sales through its owned and licensed stores. This was updated on 14 November 2018 to an increase of 2.3% to 2.5 %, finally revised to growth of ~2.0% yesterday.
The company saw a strong performance across fine jewellery, women?s shoes, fragrance, dresses, outerwear, active, and home but it was primarily offset by the underperformance of women?s sportswear, seasonal sleepwear, fashion jewellery, fashion watches, and cosmetics coupled with the fire in West Virginia distribution centre. The company was also unable to properly evaluate the impact of its redeemable promotional events along with the changes to the pre-Christmas earn.
Earlier, the company was expecting the sales to grow by 0.3% to 0.7% which was updated with no growth in sales. Similarly, the gross margin was also supposed to increase but is expected to fall now.
The diluted EPS excluding settlement charges, impairment, and other costs was expected to lie in the range of $4.10 to $4.30 is now supposed to lie between $3.95 to $4.00. The calculation of EPS included approx. $155 million from the gain on the anticipated sale of a building in San Francisco which might shift into fiscal 2019.
The company is also expecting a gain on sale of an asset of ~$360 million which was earlier expected to be $300 to $325 million.
As per the management, with the beginning of the holiday season, the company saw a strong performance particularly during Black Friday and the following Cyber Week which got weakened during the mid-December period until the week of Christmas and did not return to expected patterns.
The company is expected to report its fourth-quarter sales and earnings on 26 February 2019.
Macy?s share closed at a price of $26.11 yesterday with the day?s high of $26.83 and day?s low of $25.50.
This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.
There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.
Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.
As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report Top Dividend Stocks to Consider in 2020CLICK HERE FOR YOUR FREE REPORT!