Macy’s Hold Rating: Balancing Improved Sales with Market Uncertainties

Citi analyst Paul Lejuez has maintained their neutral stance on M stock, giving a Hold rating today.

Paul Lejuez has given his Hold rating due to a combination of factors influencing Macy’s current market position. The company’s first-quarter performance exceeded expectations, with sales trends improving as the quarter progressed and further gains observed in May. Despite this, the overall consumer demand remains volatile, and management has prepared for potential declines in consumer spending. Additionally, the recent court decision blocking Liberation Day tariffs adds an element of uncertainty to the business outlook.
Management has also indicated that while the stock is not overvalued, the macroeconomic uncertainties and ongoing challenges faced by department stores suggest a balanced risk/reward scenario. The company has shown flexibility in pricing strategies to capture market share, especially in categories where competitors are under pressure. Furthermore, the impact of tariffs and the varied responses from vendors, along with the mixed consumer sentiment across different income demographics, contribute to the cautious outlook. These factors collectively justify the Hold rating, as the potential for growth is tempered by these uncertainties.

In another report released today, Barclays also maintained a Hold rating on the stock with a $12.00 price target.

Based on the recent corporate insider activity of 22 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of M in relation to earlier this year.