Macy's Inc. (M - Get Report)  shares spiked on Wednesday, May 16, after the retailer issued a strong earnings report and upgraded 2018 guidance.

Shares were up 9% to $32.65 in mid-morning trading.

The stock had risen 6.8% to $32 in premarket trading after first-quarter sales rose 3.6% to $5.54 billion from a year earlier and exceeded Wall Street estimates. Same-store sales jumped 3.9% on an owned basis vs. expectations of up 0.7%. 

"The sales uplifts are particularly impressive, with a 3.9% rise in comparables (4.2% on an owned plus licensed basis) suggesting that Macy's recovery is gaining momentum" wrote GlobalRetail Data managing partner Neil Saunders in a press release. "That said, there are a few caveats that need to be addressed in order to provide a balanced view."

Those caveats, according to Saunders, include a shift in the Friends and Family promotion, which last year fell in the second quarter; the very weak prior year comparative when sales dropped by 5.2% on a comparable basis and by 7.5% on a total basis; and that the strong consumer economy buoyed some of Macy's good news. 

The company also reported first-quarter adjusted earnings of 42 cents a share, beating analysts' consensus of 37 cents, and 26 cents from the same period last year.

Macy's CFO Karen Hoguet said during the earnings call on Wednesday that the strong quarter was due to many factors, including more robust consumer spending and higher sales from foreign tourists. "International tourist sales were up close to 10% in the quarter, which is only the second time since 2014 when we experienced an increase," added Hoguet.

Macy's said Wednesday it raised guidance for 2018, saying it expects earnings of $3.95 a share, up from $3.75, and total sales in a range of down 1% to up 0.5%. 

"The winning formula for Macy's is a healthy brick-and-mortar business, robust e-commerce and a great mobile experience," Macy's CEO Jeff Gennette said in a press release.

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