NEW YORK (AP) — Macy's Inc.'s first-quarter profit rose a better-than-expected 38 percent. But investors sent its shares down nearly four percent because the department store chain mostly left its annual profit guidance intact.
Macy's, which has been a standout among its peers throughout the economic recovery, is the first in a series of retailers that will report first-quarter results that can provide insight into how Americans are spending. Economists have worried that Americans would cutback amid renewed fears about the U.S. jobs and housing markets and the European debt crisis.
Like many department stores, Macy's suffered during the recession. But the retailer has been able to navigate through the slow recovery better than competitors like J.C. Penney and Kohl's. Still, investors are scrutinizing every earnings report during the shaky recovery.
"Macy's is doing really well, but the market may have been expecting them to do even better," said Brian Sozzi, chief equities analyst at NBG Productions, an independent research firm. "It comes at a time when concerns about consumer spending are being ratcheted up."
Macy's Chief Financial Officer Karen Hoguet told analysts during a conference call Wednesday that the chain has had a pickup in sales at stores that shared the same mall with J.C. Penney's, which earlier this year got rid of hundreds of sales and rolled out an "everyday" low pricing strategy. The company declined to give details.
The company also has gotten a boost from some of its own initiatives. For instance, a big part of Macy's strategy has been to tailor its fashions to local markets.
Macy's has been catering to customers in a way that had been lacking since the chain ditched its numerous regional nameplates such as Marshall Field's and Hecht's in 2006. For example, the retailer has increased its offerings of conservative business suits in Washington, D.C.,
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