NEW YORK (TheStreet) -- Macy's (M) rose 5.2% to $54.52 in after hours trading Wednesday following an announcement that it will cut 2,500 jobs and shut down five underperforming stores, while opening eight others.
The retailer said it will reassign or transfer some employees as it reorganizes to maintain profitability. It will keep its workforce level at about 175,000 workers.
In a separate announcement Macy's said same-store sales in November and December rose 3.6% from the year-ago period. Same-store sales were up 4.6% when including third parties.
Macy's also narrowed its guidance for second-half sales growth to a range of 2.8% to 2.9%, compared to its prior guidance of 2.5% to 4%. The retailer reaffirmed its full-year profit estimates of $3.80 to $3.90 a share. The guidance calls for same-store sales to rise 2.5% to 3% for the year with profit of $4.40 to $4.50 a share.
TheStreet Ratings team rates MACY'S INC as a Buy with a ratings score of A. The team has this to say about its recommendation:
"We rate MACY'S INC (M) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, solid stock price performance, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."