Macy’s Inc. (NYSE: M) saw its shares take a step back on Thursday after the company reported numbers from its holiday season, as well as updated guidance for the 2017 full year. Apart from this, the company gave a general business update that included store closures and “staffing adjustments.”
The retailer expects to see annual savings of roughly $300 million from its newly implemented strategy. Macy’s will close 11 stores in early 2018, making a total of 81 closures of its planned 100 announced back in August 2016.
In terms of the 2017 full-year numbers, Macy’s now expects comparable sales on an owned basis to decline in the range of 2.4% to 2.7%, with comparable sales on an owned plus licensed basis to decline between 2.0% and 2.3%. Total sales are expected to be down between 3.6% and 3.9% in fiscal 2017.
Excluding the change in federal tax law, the firm anticipates earnings results for full-year 2017 to be in the upper end of previously disclosed guidance. As a result, the company is raising its full-year 2017 earnings guidance. The company now expects earnings per share (EPS) in the range of $3.59 to $3.69.
The consensus estimates call for $3.45 in EPS and $24.69 billion in revenue for the 2017 fiscal year. The previous full year reported $3.11 in EPS and $25.78 billion in revenue. Look for these earnings to come out in late February.
Jeff Gennette, Macy’s CEO, commented:
Macy’s had a solid holiday shopping season, and we are pleased that our November/December performance resulted in positive comp sales for the period, setting us up for a positive fourth quarter. Consumers were ready to spend this season, and we delivered with solid execution, fresher inventory, a curated gift assortment and a focus on customer experience. We saw improved sales trends in our stores and continued to see double-digit growth on our digital platforms. Customers also responded well to our new loyalty program. We intend to close the fourth quarter in a good position and head into 2018 with momentum.
Shares of Macy’s were down about 6% at $23.83 early Thursday, with a consensus analyst price target of $24.65 and a 52-week range of $17.41 to $34.37.