) has been trying every means to keep itself on the growth
trajectory in an economy, which is gradually making its way out of
the woods. The comparable-store sales for the month of April did
lose momentum, but managed to record a marginal increase. The sales
also came below analysts' expectations.
The leading department store retailer in the U.S. saw its
comparable-store sales rising 1.2% in April 2012, following an
increase of 7.3% in March 2012 and compared with a massive growth
of 10.8% in April 2011.
Cincinnati, Ohio-based Macy's said that its total sales for the
four-week period ended April 28, 2012, inched up 0.4% to $1,928
million from $1,920 million in the same month last year.
April sales were anticipated to be softer than March on account
of the shift in Easter and the cosmetic event to the latter month
from April in the prior year. Moreover, the timing of Mother's Day
in the later part of May also proved unfavorable for April
However, comparable-store sales for the combined March and April
period jumped 4.4%, which dovetailed with the company's guidance
range of 4.3% to 4.5%. Notably, the guidance was raised from a
range of 3% to 3.5% on April 5.
Online sales, which include sales from macys.com and
bloomingdales.com, continued to show growth momentum in April,
soaring 29.9%. The company seeks to expand both Macy's and
Bloomingdale's brands online.
Macy's also declared its sales data for the first quarter of
2012. Sales for the quarter increased 4.4% to $6,147 million from
$5,889 million reported in the prior-year quarter. Comparable-store
sales also registered a growth of 4.4%. Online sales for the
quarter surged 33.7%. The company will come out with its
full-fledged earnings results on May 9. The current Zacks Consensus
Estimate for the quarter under review is 39 cents a share.
Macy's department stores sell a wide range of merchandise. Its
products include men's, women's, and children's apparel and
accessories, cosmetics, home furnishings and other consumer
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.
In an attempt to increase sales, profitability and cash flow,
the company has been taking steps such as integration of
operations, consolidation of divisions, customer-centric
localization initiatives, as well as developing e-commerce business
and online order fulfillment centers. Moreover, Macy's continues to
focus on price optimization, inventory management and merchandise
planning to drive traffic.
Currently, we have a long-term 'Neutral' recommendation on the
stock. However, Macy's holds a Zacks #1 Rank that translates into a
short-term 'Strong Buy' rating.
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