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Macy’s, Inc. | $M Stock | Shares Fall On Poor Sales & Guidance Numbers

|Includes: Macy's Inc. (M)
Macy’s, Inc. (NYSE: M)

Macy’s, Inc. (NYSE:M), a leading national retailer yesterday announced that it's November and December Sales numbers fell 2.7% compared to the same period last year. Macy's has reduced its full year diluted earnings per share guidance to be in between $2.95 and $3.10 per share down from previous guidance of $3.15 to $3.40 per share. Macy's also announced that it will be closing 63 stores during the spring of 2017 which will result in a loss of $575 million in sales for 2017.

Macy’s, Inc. CEO's Comments

"While our sales trend is consistent with the lower end of our guidance, we had anticipated sales would be stronger. We believe that our performance during the holiday season reflects the broader challenges facing much of the retail industry. We are pleased with the performance of our digital business, with double-digit gains at both macys.com and bloomingdales.com; however, store sales continued to be impacted by changing customer behavior. Our apparel business, which includes women's, men's and children's, performed well, with particular strength in active and cold-weather merchandise. Sales were also strong in fine jewelry, as well as furniture and bedding, reflecting the success of our initiatives in those categories. However, ongoing weakness in handbags and watches negatively impacted our results," said Terry J. Lundgren, Macy's, Inc. chairman and chief executive officer. Business Wire

Macys Technical Analysis

M opened trading yesterday at $35.51 which was up from the previous day's trading close of $35.23. M closed trading yesterday at $35.84 and crashed down after market to $32.27, equivalent to a 10% decrease from the closing price. Taking a look at the daily chart we can see that the last time M traded below these levels we have to go back to June 27th, 2016 when it traded at $31.71. Taking a closer look at the daily chart we can see that before the spike down M had already been in an overall downward trend dating back to November 23rd when it traded at $44.91. M has a float of 304.58 million shares and traded 1.58 times the normal daily trading volume on Wednesday. For trading purposes, I would like to see M open trading on Thursday below $33.50 and if it does I would be looking to take a short position at the bell. My stop loss would be $0.30 from my entry position fearing anything more than that and the stock would start to fill in the gap down.

Company Profile

Macy’s, Inc., together with its subsidiaries, operates stores, Websites, and mobile applications in the United States. Its stores and Websites sell a range of merchandise, including apparel and accessories for men, women, and children; cosmetics; home furnishings; and other consumer goods. The company also operates stores that offer a range of women's, men's, and children's apparel; shoes; fashion accessories; housewares; home textiles; intimate apparel; and jewelry. As of November 14, 2016, it operated approximately 870 stores under the Macy's, Bloomingdales, Bluemercury, Bloomingdale's Outlet, and Macy's Backstage brands, as well as Websites, including macys.com, bloomingdales.com, and bluemercury.com. In addition, it operates as a beauty products and spa retailer. The company was formerly known as Federated Department Stores, Inc. and changed its name to Macy’s, Inc. in June 2007. Macy’s, Inc. was founded in 1830 and is based in Cincinnati, Ohio. Yahoo Finance

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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.