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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 at $22.36 in the latest trading session, marking a +1.18% move from the prior day. This change outpaced the S&P 500's 1.15% gain on the day. At the same time, the Dow added 1.11%, and the tech-heavy Nasdaq gained 11.35%.

Heading into today, shares of the department store operator had lost 3.95% over the past month, lagging the Retail-Wholesale sector's gain of 1.99% and the S&P 500's gain of 4.49% in that time.

Wall Street will be looking for positivity from Macy's as it approaches its next earnings report date. This is expected to be March 2, 2023. In that report, analysts expect Macy's to post earnings of $1.60 per share. This would mark a year-over-year decline of 34.69%. Meanwhile, our latest consensus estimate is calling for revenue of $8.2 billion, down 5.32% from the prior-year quarter.

Any recent changes to analyst estimates for Macy's should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.17% lower within the past month. Macy's is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, Macy's is holding a Forward P/E ratio of 5.86. For comparison, its industry has an average Forward P/E of 9.97, which means Macy's is trading at a discount to the group.

It is also worth noting that M currently has a PEG ratio of 0.49. 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. Retail - Regional Department Stores stocks are, on average, holding a PEG ratio of 0.87 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 203, putting it in the bottom 20% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow M in the coming trading sessions, be sure to utilize Zacks.com.


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