S&P may lower Macy's rating

November 30, 1990|By Los Angeles Times

Standard & Poor's Corp. said yesterday that it is considering lowering its investment rating on R.H. Macy & Co.'s $2.5 billion in junk bonds largely because of the big retailer's weak performance this year.

The announcement by Standard & Poor's, a leading New York investment-rating service, followed this week's disclosure that Macy's lost an unexpectedly high $66.1 million in its first quarter ended Oct. 31 on sales that fell 9.5 percent to $1.55 billion. Analysts have expressed concern about the company's declining sales as it heads into the pivotal Christmas shopping season.

With Macy's junk bonds already trading at what analysts consider bankruptcy levels, the securities' prices have held firm this week despite the bad news. Macy's junk bonds maturing in 1998 are trading at around 44 cents on the dollar, and its 14.5 percent bonds maturing in 2001 are around 30 cents.

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