Macy’s Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Macy’s (NYSE:M) will unveil its latest earnings on Wednesday, November 7, 2012. Macy’s is a retailer that sells apparel and accessories, cosmetics, home furnishings and other consumer goods.

Macy’s Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of 28 cents per share, a decline of 12.5% from the company’s actual earnings for the same quarter a year ago. The average estimate is the same as three months ago. Between one and three months ago, the average estimate moved down. It has risen from 27 cents during the last month. Analysts are projecting profit to rise by 17.4% compared to last year’s $3.38.

Past Earnings Performance: Last quarter, the company beat estimates by 3 cents, coming in at net income of 67 cents a share versus the estimate of profit of 64 cents a share. It marked the fourth straight quarter of beating estimates.

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A Look Back: In the second quarter, profit rose 15.8% to $279 million (67 cents a share) from $241 million (55 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 3% to $6.12 billion from $5.94 billion.

Stock Price Performance: Between August 8, 2012 and November 1, 2012, the stock price rose $2.51 (6.6%), from $38.01 to $40.52. The stock price saw one of its best stretches over the last year between July 12, 2012 and July 20, 2012, when shares rose for seven straight days, increasing 8.4% (+$2.77) over that span. It saw one of its worst periods between May 3, 2012 and May 10, 2012 when shares fell for six straight days, dropping 9% (-$3.72) over that span.

Wall St. Revenue Expectations: On average, analysts predict $6.05 billion in revenue this quarter, a rise of 3.4% from the year-ago quarter. Analysts are forecasting total revenue of $27.7 billion for the year, a rise of 4.9% from last year’s revenue of $26.4 billion.

Key Stats:

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 11.7% in the fourth quarter of the last fiscal year and 38.2% in the first quarter before increasing again in the second quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 4.1% in the third quarter of the last fiscal year, 5.5% in the fourth quarter of the last fiscal year and 4.3% in the first quarter before increasing again in the second quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.52 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term.

Analyst Ratings: With 10 analysts rating the stock a buy, none rating it a sell and four rating the stock a hold, there are indications of a bullish stance by analysts.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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