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Strength Seen in Macy's (M): Can Its 7.5% Jump Turn into More Strength?

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Macy's (M - Free Report) shares ended the last trading session 7.5% higher at $18.80. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 22.8% loss over the past four weeks.

Macy’s has been benefitting from the successful execution of Polaris strategy, robust omni-channel capabilities and curated merchandise assortment. Macy's digital business remain one of the major revenue drivers. The company has been undertaking a host of initiatives to provide customers a seamless shopping experience. The stock also got an upgrade from J.P. Morgan analyst on featuring its rebranding actions.

This department store operator is expected to post quarterly earnings of $0.46 per share in its upcoming report, which represents a year-over-year change of -57.4%. Revenues are expected to be $5.13 billion, down 4.1% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Macy's, the consensus EPS estimate for the quarter has been revised 43.4% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on M going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Macy's is a member of the Zacks Retail - Regional Department Stores industry. One other stock in the same industry, Dillard's (DDS - Free Report) , finished the last trading session 1% higher at $310.87. DDS has returned -14.7% over the past month.

For Dillard's, the consensus EPS estimate for the upcoming report has changed +1.4% over the past month to $8.94. This represents a change of -33.1% from what the company reported a year ago. Dillard's currently has a Zacks Rank of #3.


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