Macy’s (M) Stock Lower Ahead of Earnings Results
NEW YORK (TheStreet) -- Shares of Macy's (M) - Get Report are down by 0.11% to $46.19 at the start of trading on Tuesday morning, one day prior to the release of the retail giant's 2015 third quarter earnings results.
Macy's will announce its latest financial results before the market open on Wednesday morning. Analysts are expecting the company to post a year over year decline in both earnings per share and revenue for the most recent quarter.
The company has been forecast by analysts surveyed by Thomson Reuters to report earnings of 53 cents per share on revenue of $6.09 billion for the three month period ended in September.
Macy's earnings came in at 61 cents per diluted share on revenue of $6.12 billion for the 2014 third quarter.
Macy's is a Cincinnati, OH-based retail company operating a wide variety of stores and websites under the Macy's, Bloomingdales and Blue Mercury brands.
Separately, TheStreet Ratings team rates MACY'S INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
We rate MACY'S INC (M) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Multiline Retail industry and the overall market, MACY'S INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
- MACY'S INC's earnings per share declined by 20.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MACY'S INC increased its bottom line by earning $4.27 versus $3.90 in the prior year. This year, the market expects an improvement in earnings ($4.65 versus $4.27).
- 40.86% is the gross profit margin for MACY'S INC which we consider to be strong. Regardless of M's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.55% trails the industry average.
- M, with its decline in revenue, underperformed when compared the industry average of 7.4%. Since the same quarter one year prior, revenues slightly dropped by 2.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, M has underperformed the S&P 500 Index, declining 11.81% from its price level of one year ago. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.
- You can view the full analysis from the report here: M
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.