by Robert Martin | November 13, 2013 9:14 am
[1]Macy’s (M[2]) gained some momentum heading into the important holiday shopping season this morning. Strong third-quarter Macy’s earnings sent M stock up 7% in pre-market trading.
Macy’s earnings per share came in at 47 cents per share, up 31% from the year-ago period and 21% above what analysts had forecast for Macy’s stock.
Apparently, Macy’s stock was able to brush off a less-than-stellar Q2[3] with some new strategies to draw in customers. One is called My Macy’s[4]. It tailors store inventory to local market demand, and dovetails with Macy’s omnichannel strategy to make it easy for customers to “shop ahead” and reserve items for pickup in-store through an online portal. The move is very similar to the site-to-store strategy[5] of rivals Walmart (WMT[6]) and Amazon (AMZN[7]).
More good news for Macy’s stock investors: A better customer service training program[8] for employees also helped to boost comparable sales this quarter, up 3.5% from the year-ago quarter.
Driving more customers to their stores through this three-pronged strategy is key for Macy’s to expand its margins and for Macy’s stock to avoid going the way of JCPenney (JCP[9]).
In the report, Macy’s reiterated its guidance from August, projecting a 2.5% to 4% increase in comparable sales in the second half of the year. Management also expects Macy’s earnings per share for the 2013 fiscal year to be in the range of $3.80 to $3.90. This is above the $3.78 earnings per share of M stock that analysts currently forecast for the year.
Going into the holidays, these positive numbers set a bullish tone for both Macy’s stock and retail stocks in general.
As of this writing, Robert Martin did not hold a position in any of the aforementioned securities.
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