) - one of the leading department store retailers in the U.S.-
posted healthy comparable-store sales for the five-week period
ended December 29, 2012, which marginally came ahead of analysts'
Comparable-store sales increased 4.1% year over year for the
month of December, as the company witnessed strong online sales.
Total sales increased 3.6% to $5.10 billion compared with $4.92
billion in the year-ago period.
For the combined November and December 2012 period,
comparable-store sales marked an increase of 2.5%. Year-to-date,
Macy's sales augmented 3.3% to $25.9 billion compared with $25.1
billion in the comparable prior-year period, whereas comps
witnessed an elevation of 3.3%.
Online sales, which include sales from macys.com and
bloomingdales.com, surged 51.7% in December 2012. On a
year-to-date basis, online sales shot up 40.4% from the
comparable year-ago period. The company remains committed to
strengthening the online presence of both its Macy's and
Management stated that sales for the first two months of the
fourth quarter remained below expectations as results were
dampened by the impact of Hurricane Sandy and lingering economic
concerns. Consequently, the company now expects same-store sales
to increase between 3% and 3.5% for the fourth quarter of 2012,
down from its earlier forecast of 4.2%. Moreover, the company
lowered its earnings guidance in the range of $1.91 - $1.96 from
$1.94 - $1.99 per share. The current Zacks Consensus Estimate
stands at $1.98 per share for the fourth quarter.
In a separate story, Macy's announced that it will be closing
down underperforming stores and open 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 two of its stores into one in Ridgedale
Center in Minnetonka by early 2014.
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.
Macy's, which competes with
J. C. Penney Company Inc
), currently operates approximately 840 department stores in 45
states, the District of Columbia, Guam and Puerto Rico.
Currently, we have a long-term 'Neutral' recommendation on the
stock. However, Macy's holds a Zacks #3 Rank that translates into
a short-term 'Hold' rating.
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