The share prices of Macy’s Inc. (NYSE:M) surged by 2.5 percent to close at $48.57 due to its first quarter profits which beat analysts’ estimates. The second largest department store chain in the United States, Macy’s Inc. (NYSE:M) had further decided to increase its buyback of shares.
Increase in revenue
The net income of Macy’s Inc. (NYSE:M) for the first quarter increased by 20 percent to $217 million or 55 cents per share, while the analysts projected only 53 cents per share for the department store chain. This increase in net income was owed to the attempts by Macy’s Inc. (NYSE:M) to improve its store sales by attracting younger generation customers.
Macy’s Inc. (NYSE:M) made attempts to customize its apparels and other products to suit the local tastes of the customers. Further, the department store chain also aimed to include exclusive products to its merchandise like Keds apparel, Madonna inspired shoes – all to woo the young customers to the stores.
In addition, Macy’s Inc. (NYSE:M) also aspired to cut down the selling, general and administrative expenses of its department stores. The expenses were effectively reduced to 32 percent of the store sales.
Fueled by the increase in net income, Macy’s Inc. (NYSE:M) had decided to increase the dividend to its shareholders by 25 percent, the first payment of which is to be made in July. In addition, the department stores chain is also planning to increase its buyback of shares to a total value of $2.6 billion from the investors.