Why Macy’s guidance triggered US retail wipeout
The department store giant’s shares plummet more than 18%
New York — Macy’s did not have as merry a Christmas as it expected, and now all of retail is under the microscope. The department store giant on Thursday released disappointing holiday sales results, with comparable sales rising 0.7%, or 1.1% including licensed departments, over a year earlier. The results forced the company to slash its annual earnings guidance. Macy’s shares plummeted more than 18% in early trading, and took shares of chains from Nordstrom to Kohl’s down with it. Even Target, which had released robust holiday sales figures earlier Thursday morning, saw its shares sink lower on Macy’s woes. Notably, Macy’s comparable sales figure isn’t as ghastly as the nosedive in the stock would indicate. But that’s not the biggest issue: even more alarming is the volatility in Macy’s business that is suggested by the details of its report. For one, the chain had just bumped up its full-year guidance as recently as November 14. Now that its view has darkened so notably in such a ...
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