Fitch downgrades Macy’s

Fitch Ratings said it downgraded the long-term issuer default rating on Macy’s, Inc. and Macy’s Retail Holdings, Inc. to BBB from BBB+ and affirmed the short-term issuer default rating at F2.

The outlook is stable.

The downgrades reflect the lack of visibility into a sales acceleration that would meaningfully improve profitability after a 14% EBITDA decline in 2015, Fitch said.

The agency also said it projects a 5% decline in sales in 2016.

Fitch said it expects the recent weakness in the mid-market apparel sector and online migration of sales to continue, limiting Macy’s competitive growth.

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