- Over the past week, the stock price of Macy’s Inc (NYSE:M) increased by 27.44% (as of 10:22 AM ET). This is why it happened.
Over the past 5 trading days, the stock price of Macy’s Inc (NYSE:M) increased 27.44% (as of 10:22 AM ET). The bigger triggers around why the stock price moved is due to the company’s earnings preview and the actual earnings reported.
Earlier this week, Zacks reported that Macy’s was likely to register a decrease in the top line when it reports the third-quarter fiscal 2020 results before the market opened today. The consensus estimate on Zacks was revenue being somewhere around $3.84 billion — which would be about 25.8% drop compared to the previous reported figure.
And the Zacks Consensus Estimate for the bottom line was a loss of 81 cents compared to earnings of 7 cents per share a year earlier.
During the pandemic, Macy’s ramped up its curbside pickup services. And feedback around these services have been very positive.
For the actual quarter, Macy’s had reported a quarterly same-store sales decline of over 20%. These results come one week ahead of Black Friday and Cyber Monday events.
In order to cut costs, Macy’s has been closing unprofitable stores. The company also had to temporarily close some stores in locations where there was a rise in COVID-19 cases such as the El Paso, Texas location.
“Macy’s, Inc. third quarter results reflect solid performance across all three brands – Macy’s, Bloomingdale’s and Bluemercury. Our results were driven by disciplined cost management, strong execution by our colleagues and an early start to the holiday shopping season,” said Jeff Gennette, chairman and CEO of Macy’s, Inc. “Customers shopped our brands across all channels in the third quarter and responded well to our expanded fulfillment offerings, such as curbside, store pickup and same-day delivery. Our digital business delivered strong growth and sales in our stores continued to recover. Customers have shifted their spending to casual apparel and categories they can enjoy as they stay at home. Several of these categories, including home furnishings, jewelry and fragrance, have generated double-digit sales growth compared to last year.”
For the fiscal third quarter ended October 31, the company reported an adjusted earnings per share loss of 19 cents, which was better than what analysts were expecting. And the company also reported $3.99 billion in revenue. Analysts were expecting less than $3.9 billion.
And the company’s net loss for the quarter was $91 million ($29 cents per share) compared to a net income of $2 million ($0.01 per share) a year earlier.
Same-store sales were down 20.2% on an owned plus licensed basis. Analysts were expecting a higher decline.
The company’s digital sales increased 27%. While this figure is impressive, it is down from 50% from the second quarter when e-commerce really surged during the pandemic.
“Looking to Holiday 2020, we know this year is different. We are committed to bringing the joy of the season to America as we do every year. From next week’s Thanksgiving Day Parade to reimagined family gatherings, we will help our customers and their families celebrate in style. We have the right gifting assortment with newness from value to luxury, and our expanded fulfillment options allow customers to shop safely and conveniently, in store or online,” added Gennette. “We continue to watch the resurgence of COVID-19 and its potential impact on our business. Our teams are executing well and have shown the flexibility and agility to adjust plans and provide a great omnichannel experience to our customers.”