Macy’s (M) closed at $29.38 in the latest trading session, marking a -1.28% move from the prior day. This change lagged the S&P 500’s daily gain of 3.43%. Elsewhere, the Dow gained 3.29%, while the tech-heavy Nasdaq added 4.26%.
Prior to today’s trading, shares of the department store operator had lost 8.06% over the past month. This has was narrower than the Retail-Wholesale sector’s loss of 12.39% and the S&P 500’s loss of 12.15% in that time.
Investors will be hoping for strength from M as it approaches its next earnings release, which is expected to be February 26, 2019. In that report, analysts expect M to post earnings of $2.76 per share. This would mark a year-over-year decline of 2.13%. Meanwhile, our latest consensus estimate is calling for revenue of $8.56 billion, down 1.22% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $4.21 per share and revenue of $25 billion, which would represent changes of +11.67% and +0.64%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for M. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. M is holding a Zacks Rank of #2 (Buy) right now.
Valuation is also important, so investors should note that M has a Forward P/E ratio of 7.07 right now. This represents a discount compared to its industry’s average Forward P/E of 10.83.
We can also see that M currently has a PEG ratio of 0.83. 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 was holding an average PEG ratio of 1.1 at yesterday’s closing price.
The Retail – Regional Department Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 198, putting it in the bottom 23% 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.
To follow M in the coming trading sessions, be sure to utilize Zacks.com.
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