Sterne Agee lowers price target on Macy's

Sterne Agee analysts on Tuesday lowered their earnings estimate and price target on Macy's Inc. as consumers have curbed spending on clothes.

THE OPINION: Consumers have shifted their spending from clothes toward bigger ticket items such as cars or homes. That has taken a toll on retailers such as Macy's.

The analysts Charles Grom and Renato Basanta said in a research note that so far, third-quarter trends have not shown much of an improvement.

Macy's could see sales pick up by the end of the quarter on pent up demand and its fourth-quarter should fare better than last year, which was hurt by Hurricane Sandy. However, the analysts still say the company's estimates for sales trends in the second half of the year are too optimistic. They also noted that the company faces six fewer shopping days between Thanksgiving and Christmas.

The analysts lowered their price target on the department store operator's shares to $52 from $55. They also lowered their full-year earnings forecast to $3.70 per share from $3.85 per share. Analysts polled by FactSet, on average, have forecast $3.84 per share.

THE STOCK: Shares of Macy's fell $1.21, or 2.7 percent, to $43.48 in afternoon trading. Its stock has been falling fairly steadily since mid-July when it closed at $50.12. It's up from $36.50 the day after Christmas last year.