Macy’s Inc. Earnings: Fifth Straight Quarters of Double-Digit Growth

The Cheat Sheet

S&P 500 component Macy’s Inc. reported its results for the fourth quarter. Macy’s is a retailer that sells apparel and accessories, cosmetics, home furnishings and other consumer goods.

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Macy’s Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for Macy’s Inc. rose to $745 million ($1.74 per share) vs. $667 million ($1.55 per share) in the same quarter a year earlier. This marks a rise of 11.7% from the year-earlier quarter.

Revenue: Rose 5.5% to $8.72 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Macy’s Inc. reported adjusted net income of $1.70 per share. By that measure, the company beat the mean estimate of $1.65 per share. Analysts were expecting revenue of $8.7 billion.

Quoting Management: “We have more than doubled our earnings over the past three years, driven by innovative strategic initiatives that are being executed with discipline at both Macy’s and Bloomingdale’s. Our diluted earnings per share, adjusted for certain items, grew by 36 percent in fiscal 2011, on top of double-digit increases in each of 2009 and 2010,” said Terry J. Lundgren, chairman, president and chief executive officer of Macy’s, Inc.

Key Stats:

Last quarter was the fifth in a row that the company saw shrinking gross margins, as they fell 0.3 percentage point from the year-earlier quarter to 41%. Over that time, margins have contracted on average 0.3 percentage point per quarter on a year-over-year basis.

The company has now seen net income rise in three straight quarters. In the third quarter, net income rose 1290% and in the second quarter, the figure rose 63.9%.

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 16 cents in the third quarter, by 8 cents in the second quarter, and by 12 cents in the first quarter.

Revenue has increased for four consecutive quarters. Revenue increased 4.1% to $5.85 billion in the third quarter. The figure rose 7.3% in the second quarter from the year earlier and climbed 5.7% in the first quarter from the year-ago quarter.

Looking Forward: For next quarter, analysts have a more positive outlook about the company’s expected results. The average estimate for the first quarter of the next fiscal year is 33 cents per share, up from 31 cents ninety days ago. Over the past three months, the average estimate for the fiscal year has climbed from $2.77 per to share to $2.82.

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

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To contact the reporter on this story: Derek Hoffman at

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