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Macy's (M) Outpaces Stock Market Gains: What You Should Know

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Macy's (M - Free Report) closed the most recent trading day at $30.74, moving +0.59% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.42%.

Heading into today, shares of the department store operator had gained 35.46% over the past month, outpacing the Retail-Wholesale sector's gain of 6.5% and the S&P 500's gain of 7.03% in that time.

Investors will be hoping for strength from M as it approaches its next earnings release, which is expected to be November 18, 2021. In that report, analysts expect M to post earnings of $0.26 per share. This would mark year-over-year growth of 236.84%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.17 billion, up 29.62% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.75 per share and revenue of $23.82 billion. These totals would mark changes of +269.68% and +37.32%, respectively, from last year.

Any recent changes to analyst estimates for M should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. M currently has a Zacks Rank of #1 (Strong Buy).

In terms of valuation, M is currently trading at a Forward P/E ratio of 8.16. This represents a discount compared to its industry's average Forward P/E of 9.37.

Also, we should mention that M has a PEG ratio of 0.68. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Retail - Regional Department Stores industry currently had an average PEG ratio of 1.03 as of yesterday's close.

The Retail - Regional Department Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 47, which puts it in the top 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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