Macy’s Inc (NYSE: M) is up nearly 10% on Tuesday after the retailer reported market-beating results for its fiscal second quarter.
Macy’s Q2 earnings snapshot
Net income printed at $275 million versus the year-ago $345 million
Per-share earnings were down from $1.08 to 99 cents
Adjusted EPS came in at $1.0, as per the earnings report
Sales slid nearly 1.0% on a year-over-year basis to $5.60 billion
Consensus was 86 cents of adjusted EPS on $5.49 billion in sales
Comparable sales were down 1.6%, better than 2.0% expected
Digital sales were down 5.0%. In the earnings press release, CEO Jeff Gennette said:
We believe we’re well positioned to respond to changing consumer behaviour. Despite inflationary pressures, consumers continued to shop Macy’s as a style source and leading gifting destination. Additionally, Bloomingdale’s and Bluemercury captured demand for luxury brands, resulting in both nameplates outperforming in the quarter.
Despite the retail news, Macy’s stock is still down more than 25% for the year.
Macy’s stock up despite lowered full-year guidance
On the downside, however, Macy’s lowered its guidance for the full year on high levels of inventory and a slowdown in consumer spending.
It now forecasts $4.0 to $4.20 of adjusted per-share earnings on up to $24.580 billion in sales this year. Gennette added:
Over the past two years, our Polaris strategy has made us faster and more agile, which has been essential to navigate rapidly changing consumer trends and macro conditions. We expect to come out of this uncertain period in a strong position with a healthy balance sheet, new capabilities, and a talented team ready to capture renewed demand.
Wall Street sees upside to $24.70 in Macy’s stock on average.
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