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Macy's Inc. (M) is trading higher today. With a little less than two hours to go before the close of the regular session, the retailer, whose competitors include The Gap Inc. (GPS) and Kohl's Corporation (KSS), was higher by 63 cents, or 2.6%, to $24.53. Volume was healthy.
The stock isn't far from the 52-week high of $25.25. The 52-week low is $10.27, so the equity has come a long way since it was stuck in the doldrums. The one-year chart shows a reasonably attractive uptrend. Earlier today, the company reported its Q1 numbers. How did they look?
One of the key metrics I focus on when it comes to this space is same-store sales. When I covered Macy's back in November, I noted a decline in comps. I'm happy to say that, according to this news source, the stat saw an increase of over 5%. The business also swung to a profit of 5 cents per share from a loss of 21 cents per share in the year-ago period.
I liked reading about management's strategy of catering to local tastes to help improve the fundamentals. Seems smart to me. You have to retain a strong national marketing/merchandising plan as well, but if this current paradigm is working, then it should remain a part of the model.
Are these results enough to make me want to buy the stock? I would not be a long-term investor in Macy's, but as a trade idea, it may have merit. Also, the company doesn't appear to be overly expensive.
If you want to have a go at Macy's, utilize a tight stop in case the market drops suddenly. And as always, don't buy the strength; wait until the shares pull back before considering an entry point.
Disclosure: I don't own any company mentioned; positions can change without notice.
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