Federated Profit Down but Shares Rise
Federated Department Stores Inc., operator of Bloomingdale’s and Macy’s, reported a 38% drop in quarterly profit, but its shares rose 6.5% in part because the results met the higher end of lowered estimates.
Investors also applauded the Cincinnati company’s ability to keep inventories down in the difficult economic environment, thus limiting exposure to margin pressure from heavy markdowns, analysts said.
Federated’s operating earnings for the fiscal third quarter ended Nov. 3 fell to $32 million, or 17 cents a share. Analysts on average had expected 15 cents, with forecasts ranging from 13 cents to 20 cents, according to Thomson Financial/First Call.
Sales fell 10% to $3.78 billion, while same-store sales declined 8.6%.
Shares of Federated rose $2.28 to $37.11 on the New York Stock Exchange.
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