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

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Macy's (M - Free Report) closed at $16.78 in the latest trading session, marking a -1.93% move from the prior day. This move lagged the S&P 500's daily gain of 0.68%.

Heading into today, shares of the department store operator had gained 5.68% over the past month, outpacing the Retail-Wholesale sector's gain of 2.18% and the S&P 500's gain of 5.41% in that time.

Wall Street will be looking for positivity from M as it approaches its next earnings report date. This is expected to be May 18, 2021. The company is expected to report EPS of -$0.43, up 78.82% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.4 billion, up 46% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.76 per share and revenue of $20.84 billion, which would represent changes of +134.39% and +20.16%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for M. 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. The Zacks Consensus EPS estimate has moved 10.86% higher within the past month. M currently has a Zacks Rank of #2 (Buy).

Digging into valuation, M currently has a Forward P/E ratio of 22.56. For comparison, its industry has an average Forward P/E of 22.56, which means M is trading at a no noticeable deviation to the group.

Also, we should mention that M has a PEG ratio of 1.88. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Retail - Regional Department Stores stocks are, on average, holding a PEG ratio of 2.22 based on yesterday's closing prices.

The Retail - Regional Department Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 22, which puts it in the top 9% 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.

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