Earnings Preview: Macy's

Macy's (M) is expected to report Q1 earnings before the market open on Wednesday, May 13, with a conference call scheduled for 10:30 am ET.

Guidance

Analysts are looking for a loss of (23c) on revenue of $5.23B. The consensus range is (32c)-(19c) for EPS, and revenue of $5.15B-$5.37B, according to First Call. The company recently reported its April same-store sales fell 9% and forecast Q1 EPS (21c)-(19c). The company said that due to inventory control and expense cutting it expects to exceed FY09 guidance of 40c-55c in 2H09 if the economy improves. The FY09 First Call consensus is 62c.

Analyst Views

Macy's shares have increased 59% during the quarter but are still 46% below the year-ago level. Barron's recently said that the company's outlook for FY10 remains dismal, and profits, though expected to grow next year for the first time in four years, still look to be 60% below results in 2006. Plus, Macy's still faces big headwinds, fierce competition and challenges, as it reorganizes and cuts costs.

Thomas Weisel analyst Liz Dunn believes Macy's FY09 EPS guidance is "conservative" and believes Macy's is navigating well in a difficult environment. She believes operating margins can recover to 7.5% by 2011.

Comments

[One of many:]

I still have no use for Macy's. Everyone I know still misses Marshall Field's.

May 13 09:51 AM

[Klugwannnabe:]

Streamline the overly large store count.Close marginal stores and find other uses for the valuable underlying Real Estate.Take advantage of the Brick and Mortar presence to push the Web presence abd bring some ambitious and aggressive youngsters into the top management level.........In other wors,modify the Business Model to take advantage of the good positions and cut down the loosers,including management that does not tolerate changes!

May 13 10:51 AM