* First-quarter earnings $0.60/share vs est $0.59
* Revenue falls 1.7 pct to $6.28 bln vs est $6.46 bln
* Raises dividend and share buyback program
* Shares rise 2 percent in early trading
(Adds analysts comments, background, graphic; updates shares)
By Maria Ajit Thomas
May 14 Department store operator Macy's Inc
stuck to its full-year profit forecast as business picked
up after a severe winter in the United States that hurt
Macy's also raised its dividend and increased its share
buyback program, helping to push the company's shares nearly 2
percent in morning trading on the New York Stock Exchange.
"The (weak business trend) improved in April when the
weather began to turn in northern climate zones. We see this as
a good sign moving forward into the second quarter," Chief
Executive Terry Lundgren said in a statement.
Macy's, which also owns the high-end Bloomingdale's chain,
reaffirmed its earnings forecast of $4.40-$4.50 per share for
the year. Analysts on average expect a profit of $4.48 per
share, according to Thomson Reuters I/B/E/S.
The forecast could be conservative as Macy's continues to
benefit from selling more brands and investments in e-commerce,
said Brian Sozzi, chief executive of Belus Capital Advisors.
The company has also remodeled many stores, including its
flagship store at Herald Square in Manhattan and launched
initiatives such as "Buy Online Pickup in Store" and "Click and
Collect" to boost sales.
"If you got the product right in April when the weather was
good and people wanted to come back to the mall, you will
probably have a somewhat decent start to the second quarter,"
Macy's namesake stores sell everything from clothing to home
goods to a mainly middle-class clientele.
The company raised its dividend to 31.25 cents per share
from 25 cents and increased its stock buyback program by $1.5
billion to about $2.5 billion.
"Macy's focus on improving the merchandise assortment while
enhancing the customer experience both in stores and online will
likely continue to drive strong results," Stifel Nicolaus
analyst Richard Jaffe wrote in a note to clients.
Macy's net income rose 3.2 percent to $224 million, or 60
cents per share, in the three months to May 3. Revenue fell 1.7
percent to $6.28 billion.
Analysts on average had expected a profit of 59 cents per
share, on revenue of $6.46 billion.
Comparable-store sales fell 1.6 percent. Analysts polled by
Consensus Metrix had expected a rise of 1.30 percent.
Macy's shares were up marginally at $58.01 in morning
trading. Up to Tuesday's close, the stock had risen 8.3 percent
(Reporting by Maria Ajit Thomas in Bangalore; Editing by Kirti
Pandey, Ted Kerr and Savio D'Souza)