UBS Remains Sidelined on Macy's (M) Following 2Q Beat and Announced Store Closures
- Donald Trump Sworn in as 45th U.S. President
- Wall Street ends higher as Trump becomes president
- Walgreens Boots Alliance (WBA) Said to Face Antitrust Concern for Rite Aid (RAD) Fix - Bloomberg
- Bristol-Myers Squibb (BMY) Says It Won't Pursue Accelerated U.S. Regulatory Pathway for Opdivo Plus Yervoy in Lung Cancer
- Apple (AAPL) Sues Qualcomm (QCOM) Over Patent Royalties in Antitrust Case - Bloomberg
Get daily under-the-radar research with StreetInsider.com's Stealth Growth Insider Get your 2-Wk Free Trial here.
UBS reiterated a Neutral rating on Macy's (NYSE: M), and raised the price target to $40.00 (from $33.00), following the company's 2Q earnings report and announced closures. Macy's reported EPS of $0.54 ahead of the Street's $0.45 estimate. Macy's will close 100 doors near year-end. A ~$1B sales reduction (-4%). Macy's believes it can offset foregone EBITDA with cost saves.
Analyst Michael Binetti commented, "M reported 2Q EPS of $0.54 (UBSe: $0.61, Street: $0.45)—beating our est ex-real estate gains ($0.50 vs UBSe: $0.48). SSS (ex-licenses) improved sequentially to -2.6% (UBSe: -5%, Street: -4.7%) from -6.1% in 1Q. 2Q GMs were solid at flat YOY (UBSe: -65bp, Street: -60bp). Inventory control was solid at -3% YOY vs revs -4%. EBIT margin (ex-gains) compressed -115bp YOY (UBSe: -135bp). SSS accelerated through 2Q, and August trends are solid. We're increasing our 3Q & 4Q SSS slightly (3Q to –1.5% from –2.5% prev, 4Q to –1% from –2% prev). That said, transactions remained deeply negative in 2Q, down -5% including ecom—leaving us cautious on raising our 4Q SSS forecast to positive (which would create a more favorable stock backdrop, in our view)."
Shares of Macy's closed at $39.81 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Skyworks Solutions (SWKS) PT Raised to $105 at Oppenheimer Following 1Q Report
- M&T Bank (MTB) PT Raised to $165 at FBR Capital Following 4Q Beat
- PacWest Bancorp (PACW) PT Raised to $60.50 at FIG Partners Following 4Q Report
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst EPS View, Analyst PT Change
Related EntitiesUBS, Earnings
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!