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Macy's (M)
NYSE:M

Macy's (M) AI Stock Analysis

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M

Macy's

(NYSE:M)

66Neutral
Macy's overall score of 66 reflects a mixed outlook. Strong financial management and attractive valuation are significant positives, but technical analysis suggests caution due to bearish trends. Strategic initiatives and leadership changes are promising, yet challenges persist in specific market segments and broader economic conditions.
Positive Factors
Earnings
Macy's reported higher than expected earnings per share, driven by stronger other revenues and cost management.
Financial Performance
Macy's delivered a sizeable EPS beat with both GM & SG&A surprising to the upside on favorable y/y shortage trends & a disciplined cost approach.
Restructuring
The company is restructuring to focus on a higher-growth, higher-margin portfolio.
Negative Factors
Market Outlook
Management's outlook for FY25 anticipates a decline in same-store sales, reflecting caution due to external challenges.
Retail Performance
Macy's guidance for lower same-store sales growth and a core EBIT dollar loss indicate potential struggles in maintaining retail performance.
Tariffs
Tariffs undermine purchasing power by boosting import prices, policy-related uncertainty instilling precaution on spending, and balance sheets less supportive.

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

Macy's Business Overview & Revenue Model

Company DescriptionMacy'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 MoneyMacy's generates revenue through the sale of a broad spectrum of products in both its physical retail stores and its e-commerce platform. The company’s primary revenue streams include the sale of apparel, accessories, home furnishings, and beauty products. Macy's leverages seasonal events, promotional sales, and exclusive brand collaborations to drive foot traffic and increase sales. Additionally, Macy's benefits from its loyalty programs, which incentivize repeat purchases and enhance customer retention. The company also explores strategic partnerships and exclusive merchandise agreements to attract a wider audience and boost its market presence. Furthermore, Macy's capitalizes on real estate assets through leasing arrangements and other revenue-generating strategies.

Macy's Financial Statement Overview

Summary
Macy's financial performance shows improvements in profitability and cash flow management, with stable gross profit margins and improved EBIT and EBITDA margins. The balance sheet is stronger with better leverage management, but high debt levels remain a concern. Cash flow is robust, supporting operational needs.
Income Statement
65
Positive
Macy's has shown mixed performance in its income statement metrics. The gross profit margin remains consistent, indicating stable cost management. However, the net profit margin has fluctuated, recovering from a negative position in 2021 to a modest positive in 2025. Revenue growth has been inconsistent, with a recent decline. The EBIT and EBITDA margins have improved, reflecting better operational efficiency, but the overall profitability still faces challenges.
Balance Sheet
70
Positive
The balance sheet indicates a solid equity position with improving stockholders' equity over the years. The debt-to-equity ratio has decreased, suggesting better leverage management. The equity ratio has also improved, highlighting a stronger financial foundation. However, total debt remains significant, posing potential risks if not managed carefully.
Cash Flow
75
Positive
Cash flow metrics show robust free cash flow growth and a strong operating cash flow to net income ratio, indicating healthy cash generation relative to earnings. Despite fluctuations in free cash flow, Macy's has maintained positive cash flow trends, supporting its financial stability and operational needs.
Breakdown
Mar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income StatementTotal Revenue
23.01B23.87B25.30B25.29B18.10B
Gross Profit
9.27B9.72B10.00B10.34B5.81B
EBIT
909.00M382.00M1.73B2.35B-956.00M
EBITDA
1.83B1.16B2.54B3.00B-3.54B
Net Income Common Stockholders
582.00M105.00M1.18B1.43B-3.94B
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.31B1.03B862.00M1.71B1.68B
Total Assets
16.40B16.25B16.87B17.59B17.71B
Total Debt
5.71B6.34B6.40B6.83B8.04B
Net Debt
4.40B5.31B5.54B5.11B6.37B
Total Liabilities
11.85B12.11B12.78B13.97B15.15B
Stockholders Equity
4.55B4.14B4.08B3.62B2.55B
Cash FlowFree Cash Flow
760.00M312.00M320.00M2.12B183.00M
Operating Cash Flow
1.28B1.30B1.61B2.71B649.00M
Investing Cash Flow
-592.00M-913.00M-1.17B-370.00M-325.00M
Financing Cash Flow
-413.00M-220.00M-1.30B-2.38B699.00M

Macy's Technical Analysis

Technical Analysis Sentiment
Negative
Last Price11.18
Price Trends
50DMA
12.94
Negative
100DMA
14.25
Negative
200DMA
14.80
Negative
Market Momentum
MACD
-0.60
Negative
RSI
42.27
Neutral
STOCH
34.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For M, the sentiment is Negative. The current price of 11.18 is below the 20-day moving average (MA) of 11.45, below the 50-day MA of 12.94, and below the 200-day MA of 14.80, indicating a bearish trend. The MACD of -0.60 indicates Negative momentum. The RSI at 42.27 is Neutral, neither overbought nor oversold. The STOCH value of 34.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for M.

Macy's Risk Analysis

Macy's disclosed 27 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 (60)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
$4.76B12.0617.56%7.71%40.01%
DDDDS
71
Outperform
$5.17B8.9433.98%0.31%-4.13%-17.60%
AEAEO
68
Neutral
$1.93B6.7018.80%4.45%1.27%96.32%
MM
66
Neutral
$3.07B5.3313.40%6.38%-3.60%442.87%
JWJWN
61
Neutral
$3.98B13.6629.58%3.14%2.20%120.00%
60
Neutral
$6.85B11.573.09%4.18%2.37%-21.38%
KSKSS
58
Neutral
$782.60M7.222.83%23.11%-7.18%-65.92%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
M
Macy's
11.18
-6.43
-36.51%
AEO
American Eagle
11.20
-12.44
-52.62%
DDS
Dillard's
335.66
-87.51
-20.68%
KSS
Kohl's
7.06
-15.23
-68.33%
JWN
Nordstrom
24.15
5.64
30.47%
URBN
Urban Outfitters
51.41
10.88
26.84%

Macy's Earnings Call Summary

Earnings Call Date: Mar 6, 2025 | % Change Since: -14.85% | Next Earnings Date: May 21, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a mix of strong performance in certain segments such as luxury and strategic initiatives like store closures, alongside challenges in consumer environment and specific categories like home. The strategic progress and financial improvements are noteworthy, but the broader economic uncertainties and specific category weaknesses temper the overall outlook.
Highlights
Strong Comp Performance
Macy's, Inc. achieved a 0.2% comparable sales gain in the fourth quarter, which was the highest of the year and best in 11 quarters. Go-forward Macy's, Inc. reported its strongest comp of the year at plus-0.6%.
Luxury Segment Growth
Bloomingdale's achieved a positive 6.5% comp, marking the strongest fourth quarter volume in its history. Bluemercury reported its 16th consecutive quarter of positive comps.
Progress in Store Closures and Capital Allocation
Closed 64 underperforming Macy's stores ahead of the annual plan and generated $283 million of asset monetization proceeds, contributing to $679 million of free cash flow, up 71% from last year.
Improved Financial Metrics
Fourth quarter adjusted EPS was $1.80, above the guidance range, driven by better-than-expected SG&A, credit card revenues, and improved shortage and asset sale gains.
Lowlights
Decline in Macy's Nameplate Comps
Total Macy's nameplate comps declined 0.9% in the fourth quarter, despite a 380 basis point improvement from the prior year.
Pressure in Home Category
The home business at Macy's faced pressure due to interest rates and competitive landscape, highlighting the need for a refresh in this category.
Uncertain Consumer Environment
Concerns about consumer health due to inflation, housing costs, and food prices contribute to an uncertain environment for retail.
Company Guidance
During Macy's fourth quarter 2024 earnings call, the company provided several key metrics and insights into its performance and outlook. Macy's reported a 0.2% increase in comparable sales, the highest in 11 quarters, with the go-forward Macy's locations achieving a 0.6% comp gain. The company's net sales were approximately $7.8 billion, and they ended the fiscal year with $1.3 billion in cash, up $272 million from the previous year. Macy's also generated $679 million in free cash flow, inclusive of $283 million from asset monetization. The annual comps improved by 510 basis points, although they were still down 0.9% compared to 2023. The company closed 64 of its 150 non-go-forward Macy's stores, which contributed to annual asset sale gains of $144 million. Additionally, Macy's lowered its capital expenditures by $111 million to $882 million. For fiscal 2025, Macy's projects net sales of $21 billion to $21.4 billion, with comparable sales expected to decline between 2% and 0.5%. The company plans to continue reducing capital expenditures while prioritizing investments that enhance profitability and stakeholder value.

Macy's Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
Macy’s Announces Leadership Changes in Bold New Chapter
Positive
Apr 1, 2025

On April 1, 2025, Macy’s, Inc. announced significant changes to its executive leadership team as part of its ‘Bold New Chapter’ strategy aimed at returning the company to long-term profitable growth. Thomas J. Edwards, Jr. will join Macy’s as Chief Operating Officer and Chief Financial Officer effective June 22, 2025, succeeding Adrian V. Mitchell. Edwards brings extensive experience from Capri Holdings Limited and is expected to drive innovation and optimize operations at Macy’s. The leadership evolution also includes new reporting structures for key executives like Barbie Cameron and Maly Bernstein, aligning with Macy’s strategic focus on strengthening and modernizing its operations to enhance customer experience and shareholder value.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.