Macy's 1Q13 Earnings Likely to Miss - Analyst Blog
14 Maggio 2013 - 11:50AM
Zacks
Macy’s, Inc. (M)
is slated to report its first-quarter fiscal 2013 results before
the market opens on May 15, 2013. In the last quarter, it posted a
positive surprise of 3.5%. Let’s see how things are shaping up for
this announcement.
Factors This Past
Quarter
My Macy's localization initiatives,
omnichannel integration, robust online sales and effective cost
management were the driving factors in the last quarter. In an
attempt to increase sales, profitability and cash flow, the company
has been taking steps such as integration of operations,
consolidation of divisions, customer-centric localization
initiatives, as well as developing e-commerce business and online
order fulfillment centers. Moreover, Macy’s continues to focus on
price optimization, inventory management and merchandise planning
to drive traffic.
Earnings
Whispers?
Despite the efforts our proven
model does not conclusively show that Macy’s is likely to beat
earnings this quarter. This is because a stock needs to have both a
positive earnings Expected Surprise Prediction (ESP) (Read: Zacks
Earnings ESP: A Better Method) and a Zacks Rank #1, #2 or #3 for
this to happen. This is not the case here, as you will see
below.
Negative Zacks
ESP: ESP for Macy’s is -1.89%. This is because the Most
Accurate Estimate stands at 52 cents, while the Zacks Consensus
Estimate is pegged at 53 cents.
Zacks Rank #3
(Hold): Macy’s Zacks Rank #3 (Hold) lowers the predictive
power of ESP because the Zacks Rank #3 when combined with negative
ESP makes surprise prediction difficult. We caution against stocks
with Zacks Ranks #4 and #5 (Sell rated stocks) going into the
earnings announcement, especially when the company is seeing
negative estimate revisions momentum.
Stocks that Warrant a
Look
Here are some other companies you
may want to consider as our model shows they have the right
combination of elements to post an earnings beat this quarter:
The Gap, Inc.
(GPS), Earnings ESP of +3.51% and a Zacks Rank #2 (Buy).
J&J Snack Foods
Corp. (JJSF), Earnings ESP of +0.90% and a Zacks Rank #2
(Buy).
Zumiez, Inc.
(ZUMZ), Earnings ESP of +8.33% and a Zacks Rank #3 (Hold).
GAP INC (GPS): Free Stock Analysis Report
J&J SNACK FOODS (JJSF): Free Stock Analysis Report
MACYS INC (M): Free Stock Analysis Report
ZUMIEZ INC (ZUMZ): Free Stock Analysis Report
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