Macy’s Inc. is proving that its recent rebound isn’t just a fleeting moment: The company posted third-quarter same-store sales that beat Wall Street’s expectations. Even so, the shares fell in early trading -- a sign that investors are still skeptical the rebound will hold.
-Comparable sales, a closely-watched measure, rose 3.3 per cent for owned and licensed stores, topping analyst expectations of 2.8 per cent. It was the fourth straight quarter of growth.
Key Insights
-Macy’s earlier struggles adapting to online shopping now look like a thing of the past: The latest data, including double-digit e-commerce growth, show the retailer’s rebound has staying power.
-Macy’s is heading into the crucial holiday shopping season with momentum. The retailer expressed confidence the gains will continue, raising its full-year forecast for profit to as much as US$4.30 a share, up from a previous outlook of as much as US$4.15.
-“The business is continuing to firm up,” said Alex Arnold, managing director of the consumer sector at Odeon Capital Group. “I think they are well set-up for the holiday.”
-Even so, the shares swung between gains and losses in early trading -- a sign that some investors are still skeptical.
Market Reaction
-The shares fell as much as 5 per cent to US$34 in early trading. Macy’s stock has gained 42 per cent so far this year.
--With assistance from Karen Lin (Bloomberg Global Data)
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