Shares of retailer Macy's Inc M were down more than 10 percent Wednesday after the company reported second-quarter results and guidance for the full year 2018.
What Happened
Macy's said it earned 70 cents per share in the second quarter on revenue of $5.572 billion, both of which came in better than the 50 cents per share and $5.55 billion Street analysts were expecting.
Comparable sales on an owned basis were flat in the quarter and were up by 0.5 percent on an owned plus licensed basis. Comparable sales on an owned basis rose 1.9 percent in the first half of 2018 and were up 2.3 percent on an owned plus licensed basis.
Net income for the quarter rose from $111 million a year ago to $166 million, or $219 million when excluding impairment and other costs, settlement charges and losses on the early retirement of debt.
Net cash provided by operating activities fell from $546 million a year ago to $544 million, and the company bought back approximately $344 million worth of senior notes and debentures.
Why It's Important
Macy's earnings beat likely took a backseat to the fact that it is struggling to grow sales at a time when consumers are spending more, CNBC reported. Sales did fall from $5.636 billion a year ago, but were up from $10.986 billion in the first half of 2017 to $11.112 billion in the first half of 2018.
What's Next
Macy's said it expects total sales for the full year to be flat to up 0.7 percent from a year ago and expects to earn between $3.95-$4.15 per share versus expectations of $3.87 per share.
Retail Reaction
Retail stocks for the most part were mostly lower Wednesday in symphony with Macy's earnings report:
- J C Penney Company Inc JCP: down 7.95 percent at the time of publication.
- Dillard's, Inc. DDS: down 8.24 percent.
- Sears Holdings Corp SHLD: down 11.75 percent.
- Kohl's Corporation KSS: down 6.37 percent.
- Nordstrom, Inc. JWN: down 5.88 percent.
Related Links:
Macy's Poised For 'Parade' Of Beat-And-Raise Quarters, Susquehanna Says In Upgrade
Morgan Stanley Turns 'Incrementally Cautious' On Macy's After 60% Gain
Photo by lngfbruno/Wikimedia.
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