The second largest department store chain in United States, Macy’s Inc. (NYSE:M) had reported first quarter profits that beat the analysts’ estimates. The share prices rose by 2.5 percent to close at $48.57. The shares of Macy’s Inc. (NYSE:M) had gained by 24 percent this year, compared to the 16 percent increase achieved by S&P 500 Index during the same period.
Increase in net income
The net income of the Cincinnati based department store chain rose by 20 percent over the previous year to reach $217 million which translates to 55cents per share. This was higher than the estimates of analysts of 53 cents. The expenditures of Macy’s Inc. (NYSE:M) was reduced to about 32 percent of the store sales which further fueled the net income.
Attempts to improve sales
The Chief Executive Officer of Macy’s Inc. (NYSE:M), Terry Lundgren had made many sincere attempts to improve the store sales like customizing the merchandise to suit the taste of local people. Further the merchandise of the stores had also been extended to include exclusive items like Madonna inspired shoes, Keds apparel etc., to attract young customers.
Increase in buyback
With increase in net income for the first quarter, Macy’s Inc. (NYSE:M) had decided to increase its buyback of shares by $1.5 billion. In addition, the company had also increased its dividend payment to shareholders by 25 percent. The quarterly dividend to the investors will now rise to 25 cents per share and the first payment will be made on July 01, 2013.
