Macy's Earnings Beat the Street

Shares of Macy's Inc. (M: Analysis) closed up 2.78% to $39.59 per share on Tuesday after the company announced higher fourth quarter earnings. Macy's reported profits which came out better than expected and upwardly revised their guidance for the company's 2013 fiscal year. While diluted earnings were $2.05 per share on revenue of $9.35 million in the fourth quarter, the figure was actually 2 percent lower than 2011's fourth quarter results due to the company having repurchased a large amount of its outstanding stock last year.

Daily Chart
Cincinnati, Ohio based Macy's Inc. is one the country's largest retailers. The company, originally founded in 1858 as R.H. Macy & Co. has its flagship store in Herald Square in Midtown Manhattan, NYC. Macy's Inc, presently operates 840 stores in 45 of the United States, Washington DC, Guam and Puerto Rico under the names of Macy's and Bloomingdales, with a store in Dubai operating under a license agreement. For the quarter ended February 2nd, 2013, the company reported a profit of $730 million or $1.83 per diluted share compared to $745million, or $1.74 in the same period one year ago. The lower profit was divided among fewer shares outstanding, since Macy's repurchased 32 million shares during 2012. Terry J. Lundgren, Macy's, Inc. President, chairman and CEO stated in a press release that, "We again added more than $1 billion in top-line sales growth in 2012. Comp sales rose by 3.7 percent for the year, on top of increases of 5.3 percent in 2011 and 4.6 percent in 2010. Earnings per share grew by double-digits for the fourth consecutive year. Operating cash flow continued to be strong, and we used excess cash to repurchase shares and double the dividend." The company's board announced a 20 cent dividend on February 22nd. CEO Lundgrend continued, "The best news of all is that we continue to see significant upside opportunity ahead in those strategies that have worked so well since we reorganized the company in 2009. Going into 2013, our team is moving ahead with new plans and actions to sharpen our approach to localized merchandise assortments and marketing, which we continue to believe is Macy's sustainable competitive advantage." Macy's guidance for future earnings has same store sales growth of around 3.5 percent in fiscal 2013. Guidance for earnings per diluted share in fiscal 2013 is now $3.90 to $3.95. The company is expecting capital expenditures for the year to be approximately $925 million. For the entire year of 2012, Macy's Inc. earned $3.24 per diluted share, compared to $2.92 in 2011. Sales for the year totaled $27.686 billion, versus $26.405 billion in 2011, an increase of 4.9 percent. Online sales were the largest gainer, increasing by 47.7 percent in Q4 and 41.0 percent for the entire year, compared to the same period one year ago. Macy's Inc. stock is up 6 percent for the year and is trading on the higher end of its range. As the company continues to streamline their operation and buy back their own stock, their stock may appreciate further if earnings continue to grow. Other News About M Macy's CEO testifies in fight over Martha Stewart Terry Lundgren testifies on behalf of Macy's in lawsuit. Martha Stewart's staffers design for Macy's AND JCP: suit Macy's tries to prove that Stewart violated her contract agreeing to work with rival JC Penney. Other Stocks in the News Activism Alone Won't Save Apple Shareholders Lack of innovation affects the company's stock price. CME Merger Talks Raise Fee Concern That May Stymie Deal Merger raises concerns over higher fees. Copyright 2013 by InvestorGuide.com, Inc. InvestorGuide has no control over the sites we link to, is not affiliated with these sites, and cannot take responsibility for their quality or suitability. The news, analysis, commentary and profile information is not meant to be comprehensive, and the data provided is not guaranteed to be accurate. WebFinance Inc., the publisher of this newsletter, is not a registered investment advisor or a broker/dealer. This is not a stock recommendation newsletter but rather a source for investment ideas, and we encourage you to fully research any company before considering investing. The opinions expressed herein are those of the author and do not necessarily represent the views of nor are they endorsed by WebFinance Inc. No employee of WebFinance has owned or currently owns any shares in the company described above. The above is neither an offer nor solicitation to buy or sell any securities. The trading of securities may not be suitable for all potential readers of this newsletter, and the purchase of stocks mentioned in this newsletter may result in the loss of some or all of any investment made. We recommend that you consult a stockbroker or financial advisor before buying or selling securities or making investment decisions. We are not responsible for claims made by advertisers and sponsors. Anyone who makes decisions based on what they read here does so at their own risk and cannot hold WebFinance Inc. (DBA InvestorGuide.com, Inc.) or its employees responsible.

Published on Feb 27, 2013
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2016. Content published with author's permission.

Posted in ...