The good news is that Macy’s is firing thousands of meaningless employees, fodder, which will save $400 million in the intermediate term. The bad news is the company has spent upwards of $7 billion on share buybacks since 2011, with another $2 billion remaining, and have lost money on almost every single transaction since.
Oh, and by the way, business sucks…because the mall is dead.
“We are seeing continued weakness in consumer spending levels for apparel and related categories. In particular, our sales trend relative to expectations meaningfully slowed beginning in mid-March, and first quarter results are below our original outlook,” Terry J. Lundgren, Macy’s chairman and chief executive officer, said in a statement. “Headwinds also are coming from a second consecutive year of double-digit spending reductions by international visitors in major tourist markets where Macy’s and Bloomingdale’s are key destinations, as well as a slowdown in some center core categories — further intensifying the challenges associated with growing topline sales revenue.”
08:01 | M
Macy’s sees 2016 EPS of $3.15-3.40 vs $3.80-3.90 prior guidance and $3.78 consensus and top-line sales expected to remain below initial expectations
Oh, don’t worry about the dividend. In spite of the fact that business is undeniably impaired, along with pursuing a share buyback frenzy, the company has once again hiked the dividend.
The business of Macy’s is not to sell goods to the consumer, after all. It is to sell their stock to the investor.
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“The business of Macy’s is not to sell goods to the consumer, after all. It is to sell their stock to the investor.”
Lots of these out there.
LOL. Good point there. The preferred business model has changed a lot in recent years.
Wall st will continue the path of greed/monetization to the end, meaning will never abate because no one stops it, no one identifies the trend leading to Rome, and the only conclusion is implosion&reset. It is, staggering. That no one can say: look guys, sales suck now, contraction will occur awhile. Instead: we will find ways to skirt cycles and natural pinnacles and ignore failure is coming. Hence, ‘boom’, buybacks propping faking pretending selfindulgence prevails, until guess what? ‘greed wins’
and destroys everyone and everything
Dont forget: President Trump called for a Macy’s boycott…..Indeud. http://thehill.com/blogs/blog-briefing-room/262198-trump-calls-for-macys-christmas-boycott
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All joking aside this looks pretty dire out there for retailers. But does it even matter at all? Is this just something we overlook and keep ripping higher? We destroyed an entire industry with coal and no one even cared.
As Randy Savage Would say ‘nothing matters. All that matters is the intercontinental belt.’
The retailers have a combined market cap of over 100 billions. If the dead mall story is indeed true, there will be a lot of bums unemployed in the next couple of months.
Not to worry. These bums can find contract work at the local AMZN Fulfillment Center from September thru December.
Again, a trend bears pointed to, Eons ago
as many other things
it says a lot about us as a species when we will fire people and cut off their source of living to save $400 million, then turn around and blow $2 billion lighting said money on fire to make a number on a piece of paper look better.
+100
Rome
Imagine what would happen once people realize that stockholder buybacks actaully cost money.