Morgan Stanley Says Macy's Pullback is a 'Buying Opportunity'

Following Macy's, Inc.

second quarter earnings miss this morning, Morgan Stanley issued a note in which the firm maintained its positive outlook on the stock and said it views the pullback as a buying opportunity. Despite the miss, Macy's management reiterated its full-year EPS guidance range of $4.40 - 4.50. However, the company did lower its same-store sales guidance to 1.5 -2 percent. In light of this, Morgan Stanley is reviewing its model. Looking ahead, Morgan Stanley noted that its retail sales indicators suggest a stronger second half of the year than the first. As a justification of its positive outlook Morgan Stanley stated, "Compelling strategies,consistent execution and strong management warrants a higher P/E multiple in our opinion.We remain convinced key strategies (My Macy's localization, Omni-channel integration, MAGIC selling) are still in the early stages of delivering results."