Share price of Macy’s, Inc. (NYSE: M) went up more than 11% earlier this Tuesday after Macy’s released its 4Q and FY 2017 Earnings and its 2018 guidance. The high-than-expectations comparable sales boosted investors’ confidence, especially when comparable sales of Macy’s have not grown on an annual basis for three years.
Helped by a new loyalty program, a fashion-forward marketing revamp, improvements to Macy's mobile app and a push to roll out new private-label items more quickly, Sales of Macy’s in the fourth quarter of 2017 increased 1.8 percent to $8.666 billion, compared with $8.515 billion sales in the fourth quarter of 2016. Comparable sales on an owned basis were up 1.3 percent in the fourth quarter and up 1.4 percent on an owned plus licensed basis.
Fourth quarter 2017 earnings per diluted share were $4.31 compared to $1.54 per share in the fourth quarter of 2016. And fiscal 2017 earnings per diluted share were $5.04 compared to $1.99 per share in fiscal 2016.
According to the document released, the company expects comparable sales on both an owned and an owned plus licensed basis to be flat to up 1 percent for fiscal 2018. Total sales are expected to be down between 0.5 percent and 2 percent, and the adjusted earnings per diluted share of $3.55 to $3.75 are expected in fiscal 2018.
As the U.S. largest department store chain, Macy’s has become emblematic of the declining brick-and-mortar retail in the face of rising eCommerce. In fiscal 2017, opened 36 Bluemercury stores, two Macy's stores, 30 Backstage off-price stores within existing Macy’s stores and one Bloomingdales store, but closed 16 Macy's stores. In addition, Macy’s has announced earlier this February that it will close its Redmond Town Center main store in Redmond, WA, in early 2019. This brings the total to 83 of the approximately 100 store closures announced in August 2016.