Efficient merchandising strategy led
) - one of the leading department store retailers in the U.S. -
to post strong comparable-store sales for the 5-week period ended
Feb 2, 2013, which handily surpassed analysts' expectations.
Comparable-store sales (comps) for this Zacks Rank #3 (Hold)
stock jumped 11.7% year over year in Jan 2013. Total sales surged
34.6% to $1.8 billion compared with $1.3 billion in the year-ago
With consumers regaining confidence, Jan 2013 was strong on
the whole for most retailers, with other players including
Stage Stores Inc.
) registering comps growth of over 10%.
For the fourth-quarter of fiscal 2012, Macy's registered a
7.2% increase in total sales to $9.4 billion, whereas comps
witnessed an elevation of 3.9%. Total sales for fiscal 2012
marked an increase of 4.9% year over year to $27.7 billion, while
comps increased 3.7%.
Online sales, which include sales from macys.com and
bloomingdales.com, surged 48.9% in Jan 2013. For the fourth
quarter and fiscal 2012, online sales shot up 47.7% and 41%,
respectively. The company remains committed to strengthening the
online presence of both its Macy's and Bloomingdale's brands.
Following a robust Jan 2013 performance, the company raised
its earnings guidance for fourth quarter and expects earnings to
be in the range of $1.94 - $1.99 per share from its earlier
guidance of $1.91 - $1.96 per share. The current Zacks Consensus
Estimate stands at $1.95 per share for the fourth quarter, which
could witness a revision in the coming days.
Apart from efficient merchandising strategies, Macy's is
focusing on closing down underperforming stores and opening
stores in regions where it generates healthy sales. The retailer
will shutter 6 stores in early spring 2013 and open 9 stores. The
company also announced the consolidation of 2 of its stores into
1 in Ridgedale Cente rin Minnetonka by early 2014.
Alongside, to better manage rising costs, the company
announced changes to its retirement plans. After incorporating
the changes, the company expects to generate EBITDA margin in the
range of 14%-15% and forecasts retirement-related expenses to be
up $10 million in fiscal 2013 from the prior year level.
Macy's has been initiating several strategies to bolster its
sales, profitability and cash flow, which include Omnichannel
strategy, integration of operations, developing e-Commerce
business, and expansion of product offerings.
We remain optimistic about the company's customer-centric
localization initiative called "My Macy's". The program aims at
improving comparable-store sales and reducing operating expenses,
with stores and merchandise assortments focusing on local
customer needs and preferences.
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