By Senad Karaahmetovic
Shares of Macy’s (NYSE:M) are up nearly 15% today after the retailer raised its adjusted EPS outlook for the full year, topping the analyst consensus.
The company reported Q1 adjusted EPS of $1.08, up from 39c per share in the year-ago period and above the consensus projection of 83c per share. Net sales totaled $5.35 billion in the period, up 14% YoY.
"Our company delivered solid results in the first quarter despite a challenging operating environment,” the company said.
"We believe that our first quarter performance reflects the durability of the Polaris strategy.”
The company hiked its FY 2023 adjusted EPS guidance to $4.53 to $4.95, up from the previous forecast of $4.13 to $4.52, while analysts were looking for $4.36 per share. Macy’s expects FY sales to grow between 0% and 1%, and anticipates FY net sales in the range of $24.46 billion to $24.70 billion, compared to the consensus estimates of $24.55 billion.
The company noted a significant demand for in-store shopping and occasion-based clothes and expects continued demand for luxury goods.
Goldman Sachs analyst Jenna Giannelli said the results are “a bright spot among retailers this earnings season, and also noteworthy was the healthier inventory to sales growth vs. peers exiting the quarter.”
“The company called out trends consistent with other retailer commentary, including increased macro pressure on consumer spend, but strength in luxury goods and occasion based apparel, driving favorable mix. We think the market reaction should be positive after underperformance in the structure year-to-date,” Giannelli wrote to clients shortly after the results were released.