Nucor earnings beat by $0.08, revenue fell short of estimates
On Wednesday, JPMorgan analyst Matthew Boss adjusted the price target for Macy’s stock, lowering it from $13.00 to $12.00, while continuing to hold a Neutral rating on the company’s shares. The stock, currently trading at $12.21, shows high volatility with a beta of 1.79. According to InvestingPro analysis, Macy’s is slightly overvalued at current levels, though it trades at an attractive P/E ratio of 5.8x and offers a significant dividend yield of 6.06%. Boss’s commentary followed Macy’s first-quarter financial results for fiscal year 2025, where the company reported an adjusted earnings per share (EPS) of $0.16. This figure slightly exceeded the consensus estimate of $0.15. With a market capitalization of $3.4 billion, Macy’s maintains strong fundamentals, including a notable free cash flow yield of 22%. InvestingPro subscribers have access to 13 additional key insights about Macy’s financial health and valuation metrics through comprehensive Pro Research Reports.
Macy’s performance showcased a smaller decline in owned/licensed same-store sales of -1.2% compared to the anticipated -2.4%. The gross margin remained flat at 39.2%, narrowly missing the projected 39.3%. However, the company experienced selling, general and administrative (SG&A) deleverage of 170 basis points, resulting in 39.9%, which was slightly better than the forecasted 40.0%. These factors contributed to an EBIT margin of 2.1%, surpassing the Street’s expectation of 1.9%.
The management at Macy’s noted a positive trend, citing momentum from improvements in product offerings and customer experience, as well as more favorable weather conditions in the March/April period. Despite these improvements, InvestingPro data shows the company faces challenges with revenue declining 3.6% over the last twelve months. Discover detailed analysis and more than 30 additional financial metrics available exclusively to InvestingPro subscribers. They also observed that the early part of May showed further progress compared to the previous months. Despite this, Macy’s management has revised the full-year 2025 EPS outlook downwards to a range of $1.60 to $2.00, which is below the prior estimate of $2.05 to $2.25 and roughly in line with the Street’s forecast of $1.84.
The updated forecast also includes an anticipated decline in same-store sales of between -0.5% to -2.0%, which brackets the Street’s estimate of -1.3%. The adjusted core EBITDA expectation is now set at 7.0-7.5%, a decrease from the previously projected 8.0-8.2%. On a reported basis, the expected range is 7.4-7.9%, down from the prior 8.4-8.6%. Macy’s also anticipates a year-over-year gross margin decline of 30-70 basis points, impacted by tariffs that could create a $0.10 to $0.25 EPS headwind, along with an SG&A deleverage of 80-110 basis points, compared to the 100 basis points deleverage previously expected.
In other recent news, Macy’s Inc. (NYSE:M) reported its first quarter 2025 financial results, surpassing Wall Street expectations. The company achieved an adjusted diluted earnings per share of $0.16, exceeding the forecast of $0.14, and reported revenue of $4.6 billion, above the anticipated $4.4 billion. These results reflect a positive surprise for investors, as Macy’s demonstrated resilience in a challenging retail environment. Additionally, Macy’s introduced several new brands and expanded its store locations, which contributed to its better-than-expected performance. Analysts from firms such as Jefferies and Barclays (LON:BARC) have noted the company’s strategic pricing decisions and efforts to navigate tariff challenges. Notably, Macy’s multi-category, multi-branded model provided flexibility, allowing it to adapt to shifts in consumer spending. The company also reported net credit card revenues of $154 million, up $37 million year-over-year, reflecting strong credit portfolio management. Macy’s remains cautious about potential impacts from tariffs and consumer spending trends, projecting net sales between $21.0 billion and $21.4 billion for the full year.
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