Macy's (M) AI Stock Analysis

• Market Cap: $3.35B
• Dividend Yield: 5.92%
• Average Volume (3M): 7.92M
• Price to Earnings (P/E): 6.2
• Beta (1Y): 1.09
• Revenue Growth: -3.77%
• EPS Growth: 4607.98%
• Country: US
• Employees: 94,189
• Sector: Consumer Cyclical
• Sector Strength: 57
• Industry: Department Stores
• EPS (TTM): 0.16
• Shares Outstanding: 271,539,520
• 10 Day Avg. Volume: 8,853,155
• 30 Day Avg. Volume: 7,921,670
• PEG Ratio: -1.48
• Price to Book (P/B): 0.71
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.35
• Enterprise Value/Market Cap: 2.33
• Enterprise Value/Revenue: 0.08
• Enterprise Value/Gross Profit: 0.85
• Enterprise Value/Ebitda: 1.31
• 1Y Price Target: $12.75
• Price Target Upside: 2.16% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11

• Rating: 72 Outperform
• Price Target: $13.00 ▲(4.17%Upside)

Macy's overall stock score reflects a mix of strong valuation and positive earnings call outcomes balanced against financial and technical challenges. The attractive valuation and strategic management initiatives provide potential upside, while existing operational and market environment challenges suggest caution. The recent leadership changes add a positive outlook for future strategic direction, supporting potential long-term growth.

Positive Factors

Analyst Recommendation

Analyst's recommendation for Macy's stock is a Buy.

Earnings Performance

Macy's reported a stronger-than-expected earnings per share for the first quarter, surpassing market expectations.

Product and Experience Improvements

Management noted momentum built in March and April attributed to improvements in product and experience, with further improvement expected.

Negative Factors

Earnings Outlook

Management lowered the full-year earnings outlook, citing a challenging retail environment and the impact of tariffs.

Macroeconomic Environment

Despite improvements, management maintains a cautious outlook due to an uncertain macroeconomic environment.

Uncertain Strategy

The departure of former CFO/COO Adrian Mitchell, a key architect of Macy's strategy, adds uncertainty to the company's future plans.

Macy's Business Overview & Revenue Model

Company Description

Macy's, Inc., an omni-channel retail organization, operates stores, Websites, and mobile applications. The company sells a range of merchandise, such as apparel and accessories for men, women, and children; cosmetics; home furnishings; and other consumer goods. As of January 29, 2022, it operated 725 department stores in the District of Columbia, Puerto Rico, and Guam under the Macy's, Macy's Backstage, Market by Macy's, Bloomingdale's, Bloomingdale's The Outlet, Bloomies, and bluemercury brands. It also operates in Dubai, the United Arab Emirates, and Al Zahra, Kuwait under the license agreements. The company also operates as a beauty products and spa retailer. The company was formerly known as Federated Department Stores, Inc. and changed its name to Macy's, Inc. in June 2007. Macy's, Inc. was founded in 1830 and is based in New York, New York.

How the Company Makes Money

Macy's, Inc. generates revenue primarily through the sale of consumer goods across its various retail channels. The company's key revenue streams include in-store sales from its numerous department stores, which offer a wide array of merchandise ranging from fashion and beauty products to home goods. Additionally, Macy's has a significant online presence, with e-commerce sales contributing substantially to its overall revenue. The company also benefits from various private label brands, exclusive merchandise, and partnerships with well-known designers and brands that drive customer traffic and sales. Furthermore, Macy's engages in promotional events and sales, such as the iconic Macy's Thanksgiving Day Parade and seasonal sales events, which enhance brand visibility and boost revenue.

Macy's Financial Statement Overview

Summary

Macy's financial performance is mixed with stable gross profit margins but declining net profit margins and revenue growth. The balance sheet shows moderate leverage and a stable equity base, though declining ROE is concerning. Cash flow management reveals strong operating cash flow but a decrease in free cash flow, highlighting the need for better cash flow efficiency.

Income Statement

Macy's income statement shows a moderate performance with stable gross profit margins around 40% over recent periods. However, the net profit margin has decreased from 6.0% to 2.4% in TTM, indicating pressure on net profitability. Revenue growth has declined recently, with a decrease from previous periods. EBIT and EBITDA margins have also seen a decline, reflecting operational challenges. Overall, the income statement presents a mixed picture with profitability concerns.

Balance Sheet

The balance sheet reflects a moderate financial position with a debt-to-equity ratio of approximately 1.27 in TTM, indicating a reasonable leverage level. Return on Equity (ROE) has decreased from 39.5% to 12.5%, showing reduced efficiency in generating returns for shareholders. The equity ratio stands at 27.7%, suggesting a stable but not overly conservative capital structure. While there is a solid equity base, declining ROE is a concern.

Cash Flow

Cash flow analysis reveals a decline in free cash flow from $760M to $369M, marking a significant reduction in free cash flow growth rate. Operating cash flow to net income ratio remains robust at 1.94, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio has decreased, reflecting reduced cash flow efficiency. Cash flow management shows some strengths but highlights a need for improvement in free cash flow generation.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	22.80B	23.01B	23.87B	25.45B	25.40B	18.10B
Gross Profit	9.21B	9.27B	9.64B	10.10B	10.44B	5.81B
EBITDA	1.73B	1.76B	1.07B	2.50B	3.00B	-3.54B
Net Income	558.00M	582.00M	45.00M	1.15B	1.43B	-3.94B
Balance Sheet
Total Assets	16.09B	16.40B	16.25B	16.87B	17.59B	17.71B
Cash, Cash Equivalents and Short-Term Investments	932.00M	1.31B	1.03B	862.00M	1.71B	1.68B
Total Debt	5.66B	5.71B	6.34B	6.40B	6.83B	8.04B
Total Liabilities	11.64B	11.85B	12.11B	12.78B	13.97B	15.15B
Stockholders Equity	4.45B	4.55B	4.14B	4.08B	3.62B	2.55B
Cash Flow
Free Cash Flow	369.00M	760.00M	312.00M	320.00M	2.12B	183.00M
Operating Cash Flow	1.08B	1.28B	1.30B	1.61B	2.71B	649.00M
Investing Cash Flow	-508.00M	-592.00M	-913.00M	-1.17B	-370.00M	-325.00M
Financing Cash Flow	-521.00M	-413.00M	-220.00M	-1.30B	-2.38B	699.00M

Macy's Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 12.48
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For M, the sentiment is Positive. The current price of 12.48 is above the 20-day moving average (MA) of 11.55, above the 50-day MA of 11.54, and below the 200-day MA of 13.70, indicating a neutral trend. The MACD of 0.05 indicates Negative momentum. The RSI at 62.49 is Neutral, neither overbought nor oversold. The STOCH value of 91.56 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for M.

Macy's Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
URBN	79 Outperform	$6.60B	15.42	19.55%	―	8.38%	52.18%
DDS	78 Outperform	$7.04B	12.45	30.93%	0.22%	-3.94%	-17.78%
M	72 Outperform	$3.35B	6.23	12.92%	5.92%	-3.77%	4607.98%
AEO	69 Neutral	$1.77B	10.43	12.19%	4.91%	-0.95%	-10.51%
Sector *	62 Neutral	$16.65B	11.30	-7.38%	3.01%	1.59%	-23.30%
KSS	60 Neutral	$1.03B	8.49	3.19%	5.46%	-7.03%	-56.59%
JWN	60 Neutral	$4.12B	14.17	29.58%	3.08%	2.20%	120.00%

Macy's Corporate Events

Macy’s Holds Virtual Annual Shareholders Meeting

On May 16, 2025, Macy’s, Inc. held its annual shareholders meeting virtually, where several key decisions were made. Shareholders approved the election of 13 directors for a one-year term, ratified the appointment of KPMG LLP as the independent registered public accounting firm for the fiscal year ending January 31, 2026, and approved the advisory vote on executive officer compensation.

The most recent analyst rating on (M) stock is a Hold with a $17.00 price target. To see the full list of analyst forecasts on Macy’s stock, see the M Stock Forecast page.