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Macy's (M)
NYSE:M
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Macy's (M) AI Stock Analysis

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M

Macy's

(NYSE:M)

Rating:76Outperform
Price Target:
$13.50
▲(3.77%Upside)
Macy's overall score reflects strong valuation and positive earnings call sentiment, despite financial performance challenges. The technical analysis supports a stable outlook with slight bullish tendencies. The company's strategic focus on luxury and inventory management is a positive, but declining profitability and external pressures remain concerns.
Positive Factors
Earnings
Macy's reported a stronger-than-expected earnings per share for the first quarter, surpassing market expectations.
Price Target
The price target for Macy's stock has been raised from $11.00 to $13.00.
Strategy
The company is restructuring to focus on a higher-growth, higher-margin portfolio.
Negative Factors
Earnings Guidance
Management lowered the full-year earnings outlook, citing a challenging retail environment and the impact of tariffs.
Personnel Changes
The departure of former CFO/COO Adrian Mitchell, a key architect of Macy's strategy, adds uncertainty to the company's future plans.
Top-line Trends
Skepticism remains that the business can deliver a topline inflection without continued GM &/or SG&A sacrifice.

Macy's (M) vs. SPDR S&P 500 ETF (SPY)

Macy's Business Overview & Revenue Model

Company DescriptionMacy's, Inc. is a leading American department store chain known for its wide range of products including clothing, accessories, cosmetics, home furnishings, and other consumer goods. With a rich history dating back to 1858, Macy's operates under its flagship brand, Macy's, as well as Bloomingdale's and Bluemercury. The company serves millions of customers across the United States through its numerous physical stores, robust e-commerce platform, and innovative digital initiatives.
How the Company Makes MoneyMacy'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 Key Performance Indicators (KPIs)

Any
Any
Other Revenue Breakdown
Other Revenue Breakdown
Examines additional revenue streams beyond core operations, shedding light on supplementary income that can impact overall financial health.
Chart InsightsMacy's credit card revenue shows volatility, with recent quarters stabilizing after a significant drop in early 2023. The earnings call highlights resilience despite challenges, with better-than-expected sales and EPS. Strategic inventory management and luxury segment performance are positives, but tariff impacts and a competitive landscape pose risks. This suggests Macy's is navigating a tough retail environment with strategic initiatives, but external pressures could affect future credit card revenue stability.
Data provided by:Main Street Data

Macy's Earnings Call Summary

Earnings Call Date:May 28, 2025
(Q1-2025)
|
% Change Since: 9.70%|
Next Earnings Date:Aug 26, 2025
Earnings Call Sentiment Neutral
Macy's demonstrated resilience in a challenging retail environment, surpassing sales and earnings expectations for the quarter. Positive performances in luxury segments and strategic initiatives in inventory management and brand partnerships were notable. However, challenges such as tariff impacts, a decline in comparable sales, and a competitive landscape were also highlighted.
Q1-2025 Updates
Positive Updates
Sales and Earnings Beat Expectations
First quarter net sales of $4.6 billion exceeded guidance of $4.4 to $4.5 billion. Adjusted diluted EPS was $0.16, above guidance of $0.12 to $0.15.
Positive Performance in Luxury Segments
Bloomingdale's posted a positive 3.8% comp, and Blue Mercury achieved a positive 1.5% comp, continuing their positive trend.
Improvement in Inventory Management
Inventories were down 0.5% entering the second quarter, reflecting disciplined inventory management and improved in-store inventory allocation.
Successful Brand Launches and Partnerships
New brands like Good American, Coach, and Donna Karan were well received. Bloomingdale's benefited from brand launches such as Prada shoes and handbags, and Reformation Ready to Wear.
Growth in Marketplace and Off-Price Concepts
Macy's marketplace achieved approximately 40% GMV growth, and Backstage outperformed full-line stores by several hundred basis points.
Negative Updates
Decline in Comparable Sales
Comparable O plus L plus M sales declined 1.2%, although this was better than the expected decline of 4.5% to 2.5%.
Impact of International Tourism
International tourism negatively impacted comps by about 30 basis points.
Tariff Challenges
Tariffs are expected to impact Macy's, Inc. annual gross margin by roughly 20 to 40 basis points, with a significant portion of tariff-affected products impacting the second quarter.
Competitive and Promotional Landscape
Expectations for an intensified promotional landscape and continued consumer pressure throughout the year.
Company Guidance
During the Macy's, Inc. First Quarter 2025 Earnings Conference Call, the company provided guidance that exceeded previous expectations in several key metrics. Net sales for the quarter were reported at $4.6 billion, surpassing the guidance range of $4.4 billion to $4.5 billion. Comparable owned plus licensed plus marketplace (O + L + M) sales declined 1.2%, which was better than the anticipated decline of 4.5% to 2.5%. Adjusted diluted earnings per share (EPS) came in at $0.16, above the guidance range of $0.12 to $0.15. Macy's go-forward business comps outperformed the total business, declining only 0.9%. The company also reported that inventories were down 0.5% entering the second quarter. For the full year, Macy's, Inc. expects net sales of $21 to $21.4 billion, with comps down 2% to flat. Adjusted diluted EPS is projected to be between $1.60 and $2. Additionally, the company highlighted the impact of tariffs, estimating a 20 to 40 basis point impact on annual gross margin. The guidance assumes a more promotional environment and no rebound in international tourism for the remainder of the year.

Macy's Financial Statement Overview

Summary
Macy's financial statements indicate a company facing profitability and cash flow challenges. Although the gross profit margin remains stable, declining net profit margins and reduced revenue growth highlight operational challenges. The balance sheet shows moderate leverage and a stable equity base, but declining ROE is a concern. Cash flow management presents a mixed picture, with strong operating cash flow but a decrease in free cash flow. Macy's may need to focus on improving profitability and cash flow efficiency to strengthen its financial position.
Income Statement
75
Positive
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
70
Positive
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
65
Positive
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.
BreakdownTTMMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue22.80B23.01B23.87B25.45B25.40B18.10B
Gross Profit9.21B9.27B9.64B10.10B10.44B5.81B
EBITDA1.73B1.76B1.07B2.50B3.00B-3.54B
Net Income558.00M582.00M45.00M1.15B1.43B-3.94B
Balance Sheet
Total Assets16.09B16.40B16.25B16.87B17.59B17.71B
Cash, Cash Equivalents and Short-Term Investments932.00M1.31B1.03B862.00M1.71B1.68B
Total Debt5.66B5.71B6.34B6.40B6.83B8.04B
Total Liabilities11.64B11.85B12.11B12.78B13.97B15.15B
Stockholders Equity4.45B4.55B4.14B4.08B3.62B2.55B
Cash Flow
Free Cash Flow369.00M760.00M312.00M320.00M2.12B183.00M
Operating Cash Flow1.08B1.28B1.30B1.61B2.71B649.00M
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-2.38B699.00M

Macy's Technical Analysis

Technical Analysis Sentiment
Positive
Last Price13.01
Price Trends
50DMA
11.86
Positive
100DMA
11.99
Positive
200DMA
13.54
Negative
Market Momentum
MACD
0.23
Negative
RSI
60.83
Neutral
STOCH
55.65
Neutral
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 13.01 is above the 20-day moving average (MA) of 12.19, above the 50-day MA of 11.86, and below the 200-day MA of 13.54, indicating a neutral trend. The MACD of 0.23 indicates Negative momentum. The RSI at 60.83 is Neutral, neither overbought nor oversold. The STOCH value of 55.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for M.

Macy's Risk Analysis

Macy's disclosed 28 risk factors in its most recent earnings report. Macy's reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Macy's Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
79
Outperform
$6.72B15.7119.55%8.38%52.18%
78
Outperform
$7.56B13.3930.93%5.37%-3.94%-17.78%
76
Outperform
$3.53B6.5812.92%6.81%-3.77%4607.98%
64
Neutral
$1.77B10.4312.19%6.13%-0.95%-10.51%
63
Neutral
$17.14B11.11-7.24%3.14%1.68%-25.43%
61
Neutral
$1.07B8.883.19%8.72%-7.03%-56.59%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
M
Macy's
12.78
-2.87
-18.34%
AEO
American Eagle
10.82
-9.25
-46.09%
DDS
Dillard's
494.62
112.64
29.49%
KSS
Kohl's
12.30
-5.90
-32.42%
URBN
Urban Outfitters
77.99
33.09
73.70%

Macy's Corporate Events

Private Placements and Financing
Macy’s Announces $500 Million Senior Notes Offering
Neutral
Jul 14, 2025

On July 14, 2025, Macy’s, Inc. announced that its subsidiary, Macy’s Retail Holdings, LLC, priced a $500 million offering of 7.375% senior notes due 2033. The proceeds from this offering will be used to fund a tender offer, redeem outstanding senior notes, and cover related expenses. The closing of this offering is expected on July 29, 2025, and is crucial for the company’s financial restructuring efforts, impacting its debt management strategy.

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.

Private Placements and FinancingBusiness Operations and Strategy
Macy’s Announces $500 Million Senior Notes Offering
Neutral
Jul 14, 2025

On July 14, 2025, Macy’s, Inc. announced that its subsidiary, Macy’s Retail Holdings, LLC, plans to offer $500 million in senior notes due 2033 in a private offering. The proceeds from this offering, along with cash on hand, will be used to fund a tender offer to repurchase certain outstanding senior notes and debentures, redeem approximately $587 million of other outstanding notes, and cover related expenses. This financial maneuver is part of Macy’s strategy to manage its debt and optimize its financial structure, potentially impacting its market positioning and stakeholder interests.

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.

Executive/Board ChangesShareholder Meetings
Macy’s Holds Virtual Annual Shareholders Meeting
Neutral
May 20, 2025

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.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 22, 2025