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Examining the Redbook and the ICSC-Goldman Sachs Retail Indices

Part 8
Examining the Redbook and the ICSC-Goldman Sachs Retail Indices (Part 8 of 10)

Macy’s, Inc and the Redbook and ICSC-Goldman Sachs Retail Indices

Macy’s, Inc.

Last week’s results were mixed. However, year-on-year comparison shows a recovery in both the Redbook and ICSC-Goldman Sachs Indices. Among all, Macy’s with a market capital of $21.4 billion is the largest departmental store. Macy’s is a subsidiary of multinational holding company—Macy’s, Inc. (M). Macy’s, Inc. primarily operates in two segments—Macy’s, which is a department store and Bloomingdale’s, which specializes in the sales of clothing, footwear, accessories, bedding, furniture, jewelry, beauty products, and household items.

MacyEnlarge Graph

Since, the beginning of the year 2014, Macy’s, Inc. (M) stock price has appreciated as much as 9%. The company has recorded consistent fourth year of comparable sales growth. The company has recently announced its full-year 2013 earnings, which showed a 3.6% increase in the November/December comparable sales. However, the January sales took a toll as 244 Macy’s and Bloomingdale’s stores were closed because of harsh weather conditions, and the business remained sluggish until Valentine’s Day, which was reflected in the decline of 1.4% in comparable sales reported in February, 2014.

The company CEO said, “We are watching business trends closely, however, in our experience, once warm spring weather arrives and our full assortment of fresh spring merchandise is in place, we believe customers will return to a more normalized pattern of shopping.” The company stock price momentum remained quite positive on this note, with 13% increase in share price on the April 8, 2014—when Redbook and ICSC Goldman Sachs Indices’ weekly same-store sales were announced.

Increase in the retail index and consumer spending are likely to have a positive impact on the share price and valuations of the other companies in the sectors including Nordstrom,Inc. (JWN), Kohl’s Corporation (KSS), J. C. Penney Company, Inc. (JCP), and Saks, Inc. (SKS).

Read the next part of the series to know the major differences in the retail ETFs.

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