Macy's Hits 52-Week High - Analyst Blog


Shares of Macy's, Inc. ( M ) attained a new 52-week high of $51.24 on Nov 18, 2013, before closing at $50.47. Shares of this Zacks Rank #3 (Hold) stock have amassed a year-to-date return of roughly 33.8%.

Based on the current price, this department store retailer is 3.0% below the Zacks Consensus average analyst price target of $52.04. The company currently trades at a forward P/E of 13.0x, almost in line with the industry average of 12.99x.

Investors have become optimistic about Macy's as it posted third-quarter fiscal 2013 earnings per share (EPS) of 47 cents that handily surpassed the Zacks Consensus Estimate of 38 cents and rose 31.0% year over year. The company reported total sales of $6,276 million, which rose 3.3% on a year-over-year basis and came ahead of the Zacks Consensus Estimate of $6,183 million.

Management cited that My Macy's localization initiatives, omnichannel integration, Magic Selling and promotional strategies were the prime factors that drove the robust performance amid a tepid economy. This is 15th successive quarter that the Cincinnati, Ohio-based company has registered year-over-year growth in earnings per share.

Additionally, we believe that Macy's sustained focus on price optimization, inventory management, merchandise planning and private label offering are the stimulants behind higher traffic inflow. The above-mentioned measures also help the company to satisfy customer-oriented demands and enhance the in-store shopping experience.

Macy's has been proactive in capital deployment. It has returned much of its free cash to shareholders through dividends and share repurchase programs, while maintaining a healthy balance sheet and strong credit ratios that are necessary for an investment-grade rating.

Macy's history of positive earnings surprises also make investors confident about the stock. We observe that the company has beaten the Zacks Consensus Estimate in the past 4 quarters by an average of 5.8%.

Apart from Macy's, other retail stocks such as Hanesbrands Inc. ( HBI ), Dick's Sporting Goods Inc. ( DKS ) and V.F. Corporation ( VFC ) achieved new 52-week highs of $69.95, $56.72 and $226.84, respectively, on Nov 18, 2013.

DICKS SPRTG GDS (DKS): Free Stock Analysis Report

HANESBRANDS INC (HBI): Free Stock Analysis Report

MACYS INC (M): Free Stock Analysis Report

V F CORP (VFC): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: DKS , EPS , HBI , M , VFC

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