Macy's Stock Rises Despite Falling Sales and Earnings: Here's Why
On Tuesday, Macy's (NYSE: M) reported that sales dipped 1% and adjusted earnings per share (EPS) fell 22% year over year last quarter. The department store giant also reduced its full-year earnings guidance, due to the negative impact of high inflation on discretionary demand and a growing industrywide inventory glut in certain merchandise categories.
Nevertheless, Macy's stock jumped after the earnings report, ending the day with a 4% gain. In the current economic environment, investors were expecting even greater sales and earnings pressure. Macy's earnings report highlighted how management's moves to improve the company's performance are paying off.
While Macy's sales and earnings declined compared to the second quarter of fiscal 2021, the company had benefited from a demand boom last spring, powered by government stimulus efforts and the gradual reopening of the economy. As a result, management had anticipated that the company's financial results would take a step backward last quarter.
Source Fool.com
