Macy’s, Inc. (M) CEO Terry Lundgren Expects Consumer Confidence To Return Right About Now

The future looks very bright for Macy’s, Inc. (NYSE:M), according to the company’s CEO, Terry Lundgren. While on an interview on CNBC he explained how the consumer confidence, the lack of which has been retarding the retail giant’s sales in the past is slowly fading away.

Although his comments came on Black Friday when the whole country was engulfed in the shopping fervour, owing to bargains offered by retailers, but Lundgren had Macy’s, Inc. (NYSE:M) long term future in mind when he made the statement.

“[…] I think the consumer is starting to feel better right about now, you are seeing that in the confidence numbers, you are seeing that, I mean in the gas prices that are obviously the big news today and all last week. That has got to help the consumer, puts more money in the consumers pocket. So, I feel very strongly that this is going to be a good finish to the year we should be off to a good start by 2015,” said Lundgren.

Oil prices have definitely had a positive impact on sales for Macy’s, Inc. (NYSE:M) and other retailers. With the current oil prices reaching lows that were seen by the market nearly four years ago, the consumers have much more disposable income.

Although Macy’s, Inc. (NYSE:M) missed the sales estimate for its third quarter earnings, but the growth in earnings was more than what analysts expected. This was mainly due to the lower costs that the retail giant has been able to incur. This is only going to get better going into the future, as oil prices decline.

Hence, the conditions prevailing in the energy market will have a two pronged effect on Macy’s, Inc. (NYSE:M)’s profitability. It will increase both the company’s sales and its margins. From the looks of it, considering the recent OPEC meeting, the oil still hasn’t hit its bottom, which is good news for retailers.

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