After struggling for some time, Macy’s Inc. (NYSE:$M) stock finally saw some gains on Monday, August 21st and Tuesday, August 22nd. The rise came after an announcement was made by Macy’s that Hal Lawton, former Senior Vice President at EBay Inc. (NASDAQ:$EBAY), will be the company’s new president. Lawton’s new position at Macy’s is a hopeful light upon the department store giant which had been struggling in the face of the rising popularity of online shopping. Lawton has had plenty of experience in online retail during his time with EBay.
“Hal Lawton has deep expertise at the intersection of retail and technology, a diverse set of business experiences that give him a unique perspective, and a track record of successfully driving a change agenda at scale,” Jeff Gennette, Macy’s CEO and who Lawton will be taking the president position from, stated. “With Hal on the team, we will accelerate the integration of digital both online and in our stores.”
Prior to working at EBay in 2015, Lawton worked for Home Depot (NYSE:$HD) for about 10 years. During that time, he had helped launch Home Depot’s online shop and turned it into a $2 billion business. Both Macy’s and its investors are no doubt hoping Lawton will do something similar for them in the near future. Despite the potential Lawton can bring to Macy’s, however, the company is still planning to cut around 100 jobs in order to improve efficiency in production. Macy’s hopes to save about $30 million annually by making some changes to production and other operations.
Set to begin his position on September 8th, Lawton will be responsible for merchandising, marketing, as well as stores and operations at Macy’s. He will begin with a $1 million salary along with a $1.25 million target bonus. Additionally, Lawton will also get about $4 million worth of the company’s stock options and restricted shares in 2018. He is also entitled to a $5.5 million cash sign-on bonus and $10.5 million worth of equity grants.
Lawton will have quite a challenge ahead of him: Macy’s has been dealing with falling sales, a drop in the amount of customers who are visiting brick-and-mortar stores, and competitors cutting down their prices. Additionally, Macy’s sales in its previous quarter had not met average analysts’ expectations. This resulted in a fall in the company’s stock. Investors and shareholders alike had continually expressed concerns as the retail industry has been in quite a slump lately. Many retail-related companies had been struggling with the same problems as Macy’s.
What Lawton’s Addition to Macy’s Executive Means For Investors
Hiring Lawton to be president showcases Macy’s commitment to working through the changes the retail industry has been facing lately, Dana Telsey, head of Telsey Advisory Group, noted. Still, Telsey believes that investors would still have to wait and see if this new strategy will make any meaningful impact on both its in-store and digital sales.
As of 3:18 PM EDT, Macy’s stock has risen by 4.89% to reach $20.48. It’s the highest gain that the company has seen in more than a month.
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