By Kimberly Chin
Shares of Macy's Inc. fell 17% in premarket trading as the department store lowered its full-year guidance following tepid holiday sales.
Comparable sales from stores it owns rose 0.7% during the months of November and December, the retailer said Thursday. Same-store sales from stores it owns and licenses rose 1.1%.
For fiscal 2018, the department store now expects comparable sales growth of about 2% compared with its previous guidance in November of 2.3% to 2.5%. Analysts polled by FactSet are expecting same-store sales for the fourth quarter of 1.8%.
Macy's, which is set to report fourth-quarter results on Feb. 26, now expects net sales to be flat compared with prior guidance of 0.3% to 0.7% growth. The company also cut its earnings forecast to between $3.95 and $4 a share, down from its previous estimate of $4.10 and $4.30.
The retailer has been investing in a group of stores it calls magnets, adding new lighting, fixtures, a better assortment of merchandising and technological innovations, while trying to shrink other less-promising locations.
Macy's delivered healthy sales growth in the third quarter. Same-store sales grew 3.1% and total sales increased 2.3%.
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