Macy’s Inc reported mixed quarterly results and announced plans to close 150 stores on Tuesday. The company reported fourth-quarter adjusted EPS of $2.45, beating the analyst consensus of $1.96. However, quarterly revenue of $8.12 billion missed the analyst consensus of $8.15 billion.
In response to these results, Macy’s announced a new strategy called “A Bold New Chapter” designed to return the company to enterprise growth. This strategy involves focusing on Macy’s resources by closing approximately 150 underproductive locations through 2026.
Looking ahead, Macy’s sees FY24 adjusted EPS of $2.45-$2.85 versus the $2.76 estimate. The company also plans for net sales of $22.20 billion-$22.90 billion versus the $22.96 billion estimate. Starting in 2025, Macy’s anticipates low-single-digit annual comparable Owned + Licensed + Marketplace sales growth and free cash flow to return to pre-pandemic levels.
Following these announcements, Macy’s shares dipped 6.1% to trade at $18.73 on Wednesday. Analysts have made changes to their price targets on Macy’s in response to the company’s quarterly results. Telsey Advisory Group raised the price target on Macy’s from $15 to $21, while Goldman Sachs increased the price target from $16 to $22. Morgan Stanley, on the other hand, cut the price target on Macy’s from $21 to $20.
In conclusion, Macy’s is taking bold steps to revamp its business and return to growth. The closure of underperforming stores and the implementation of a new strategy signal a commitment to adapting to changing market conditions. Investors and analysts will be watching closely to see how these changes impact Macy’s performance in the coming quarters.
