Macy’s (M) closed the last day of trading at $17.84, moving +0.96% from the previous trading session. The stock topped the S&P 500’s 0.16% daily loss. Elsewhere, the Dow gained 0.23%, while the tech-heavy Nasdaq gained 0.12%.
Going into today, shares of the department store operator had lost 1.51% in the past month, lagging the retail and wholesale sector’s 12.2% gain and the 8.67% gain in the S&P 500 during this period.
Wall Street will be looking for positivity from Macy’s as it nears its next earnings release date. The company is expected to post EPS of $0.87, down 32.56% from the prior year quarter. Our most recent consensus estimate calls for quarterly revenue of $5.52 billion, down 2.33% from the prior year period.
Looking to the full year, our Zacks consensus estimates suggest analysts are expecting earnings of $4.56 per share and revenue of $24.43 billion. These totals would mark changes of -14.12% and -0.1%, respectively, from last year.
It’s also important to note recent changes to analyst estimates for Macy’s. These recent revisions tend to reflect the evolving nature of short-term trading trends. With this in mind, we can view positive estimate revisions as a sign of optimism about the company’s business prospects.
Research indicates that these revisions to estimates are directly correlated to near-term stock price dynamics. To benefit from this, we have developed the Zacks Rank, a proprietary model that takes into account these estimation changes and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven track record of outperformance, with #1 stocks returning an average of +25% per year since 1988. In the past 30 days, our consensus EPS projection is down 2.03%. Macy’s is currently a Zacks Rank #3 (Hold).
In terms of valuation, Macy’s is currently trading at a forward P/E ratio of 3.88. For comparison, its industry has an average Forward P/E of 6.37, which means Macy’s is trading at a discount to the group.
We can also see that M currently has a PEG ratio of 0.32. This measure is used in the same way as the famous P/E ratio, but the PEG ratio also takes into account the growth rate of the stock’s expected earnings. Retail – Shares of regional department stores maintain, on average, a PEG ratio of 0.62 based on yesterday’s closing prices.
The Retail – Regional Department Stores industry is part of the Retail – Wholesale sector. This group has a Zacks Industry Rank of 243, which places it in the bottom 4% of all 250+ industries.
The Zacks Industry Rankings are ranked from best to worst in terms of the average Zacks Ranking of individual companies in each of these industries. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and more, at Zacks.com.
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Macy’s, Inc. (M): Free Stock Analysis Report
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