Macy’s Recovery Parade Could End on Weak Earnings

Macy’s, Inc.  is considered America’s premier mall anchor with its nearly 1,000 Macy’s and Bloomingdale’s stores. Macy’s has been feeling the drag of losing sales to online retail behemoth Amazon.com, Inc. since mid-2015. Since the week of July 17, 2015, shares of Macy’s have crashed by 76% from the all-time high of $73.61 to a multi-year low if $17.41 set during the week of Nov. 10, 2017. The department store giant is set to report quarterly earnings before the opening bell on Wednesday, May 16.

Macy’s stock closed Friday, May 11, at $29.64, up 17.7% year to date and up by a bull market measure of 31.9% since setting its 2018 low of $22.47 on Feb. 6. From its 2018 high of $32.45 set on April 27, the stock is down 8.7%, and it could fall into correction territory on a negative reaction to earnings.

Analysts expect Macy’s to post earnings per share between 36 cents and 40 cents when the mall anchor reports results on Wednesday. Macy’s reported solid fourth quarter earnings on Feb. 27, propelling the stock higher. Can this performance continue? It depends upon strength from Amazon.com, which had a blow-out quarter. For Macy’s, continued online sales growth must keep up with the growth at the online retail leader. (See also: Macy’s and the Day Retail Died.)

 

Macy’s reports earnings as a mall anchor in recovery mode. The stock may be too cheap to ignore, as its P/E ratio is 5.88 with a dividend yield of 5.09%. …read more

Read more here: Macy’s Recovery Parade Could End on Weak Earnings

Category: M, AMZN

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