Macy's Shares Rise After Earnings Beat

Macy's Inc. shares rose 3.4% in Tuesday premarket trading after the department store retailer announced fourth-quarter earnings that beat expectations. Net income was $475 million, or $1.54 per share, down from $544 million, or $1.73 per share last year. Adjusted EPS was $2.02, beating the FactSet consensus of $1.95. Sales were $8.52 billion, down from $8.87 billion last year, and below the $8.62 billion FactSet consensus. Same-store sales on an owned-plus-licensed basis fell 2.1% compared with a FactSet consensus of a 2.5% decline. The company completed the $250 million sale of the Union Square Men's building in San Francisco. And the previously announced Chief Executive Officer transition to Jeff Gennette, the current president, from Terry Lundgren will take place on March 23, 2017. Macy's sees a fiscal 2017 same-store sales decline between 2% and 3% on an owned-plus-licensed basis. The FactSet consensus is a 2.2% decline. Sales are expected to fall between 3.2% and 4.3% for the year, owing to 66 store closures. And adjusted EPS excluding the anticipated gain from the Union Square sale and anticipated settlement charges are expected to be $2.90 to $3.15. The FactSet consensus is $3.17. Macy's shares are down 19.7% for the past year while the S&P 500 index is up 22.6% for the same period.