S&P Places Macy's BBB Rating On CreditWatch Negative
Standard & Poor's Global Ratings on Thursday placed ratings on department store chain Macy's Inc. on CreditWatch negative, meaning it could downgrade the credit in the near term. S&P rates Macy's at BBB, or two notches above speculative, or "junk" status. The move comes after Macy's late Wednesday warned on 2016 profit after weaker-than-expected holiday sales. It also announced it was cutting 6,000 jobs. "The extent of any downgrade will incorporate our view of Macy's ability to cope with the weak operating trends in the department store sector that continue to reflect symptoms of secular changes in the retail industry," said S&P. "While many department stores have considerable excess real estate, consumers are increasingly shifting their purchases online, drawn by convenience, selection, and price transparency." Macy's shares were trading down 12%, while the S&P 500 was flat.
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