Macy’s, Inc. (M) stock kicked off 2015 by hitting all-time highs, and despite reasonably good holiday selling period, the retailer appears intent on keeping M stock at such lofty levels whatever the short-term cost.

Why else would it be restructuring — closing stores and laying off employees — even as holiday sales met the upper range of its projections?

Macy’s stock took a tumble at week’s end on the announcement. Taking a surprise hatchet to operations clearly spooked a market that was basking in better-than-expected results in the retail sector over the holiday selling period.

Even some of the most troubled retail chains enjoyed stronger sales and margins than they or Wall Street projected. Mid-market department store J C Penney Company Inc (JCP) enjoyed encouraging results in November and December, as did teen retail chains Urban Outfitters, Inc. (URBN), Aeropostale Inc (ARO) and American Eagle Outfitters (AEO).

So, although Macy’s similarly announced good cheer from holiday sales, the market was prepared for its expectations to be eclipsed. Instead, the lack of better-than-expected news and restructuring announcement raised suspicions that there’s another shoe still to drop. After all, the market usually loves cost cuts, and Macy’s holiday sales were fine.

Macy’s said same-store sales — an important measure of a retailer’s health — rose 2.7% over the nine weeks ended Jan. 3. That’s toward the higher end of Macy’s projection of 2% – 3% growth for the fourth quarter.

Furthermore, in a move that should be supporting M stock, Macy’s affirmed its full-year guidance and lifted the low end of its quarterly same-store sales forecast. Macy’s now expects same-store sales to increase by 2.5% to 3%, up from the prior view of 2% to 3%.

But that couldn’t take the market’s attention away from the restructuring news, which put selling pressure on Macy’s stock.

Macy’s Stock Stung on Store Shutterings

Macy’s said it needs to restructure its operation in response to changes in the way consumers shop in stores and online. To that end, Macy’s said it will close 14 department stores and lay off about 2,200 workers. Those moves are expected to save $140 million a year, which Macy’s said it will reinvest in the business.

Consumers are still very reluctant to spend their discretionary income, probably because wage growth and hours worked have failed to keep pace with job creation. Given that backdrop, Macy’s said its contemplating opening an off-price business and intends to expand its number of outlet stores.

As well as Macy’s and M stock have done focusing on its middle-to-higher end clientele, the retail appears to be saying that consumers are entrenched in their demand for value pricing.

And M stock has indeed done well by investors amid a tough retail environment. Even after Friday’s selloff in M stock, Macy’s stock is up 19% over the last 52 weeks vs. a gain of 13% for the broader market.  Indeed, since the bull market began in 2009, M stock is up nearly 900%. The S&P 500 tripled over the same span.

Given that history of outperformance — both operationally and in the Macy’s share price — the current selloff should be short-lived.

There are precious few promising names to be found in the retail sector. Investors can be forgiven for looking for better buys elsewhere. But if you remain keen on retail, Macy’s stock is one of the better bets you can find.

As of this writing, Dan Burrows did not hold a position in any of the aforementioned securities.