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Macy's Inc M

Morningstar Rating
$19.81 −0.04 (0.20%)
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Company Report

Macy’s: Raised Offer Should Be Considered; Shares Attractive

On March 3, Arkhouse Management and Brigade Capital issued a press release to announce that they have raised their per share bid for Macy’s to $24 from $21. In addition, they revealed that Fortress Investment Group and One Investment Management have joined the bid as equity capital partners. After this release, Macy’s issued a press release of its own that confirmed its receipt of the revised offer and stated that its board would “review and evaluate” it. Conspicuously, it did not commit to engaging with the investors or granting due diligence information, as has been requested. Over the past several weeks, Macy’s board has argued that the original offer was too low and that the financing was uncertain. Now that the investment group has raised its bid by 14% and announced additional equity partners, these concerns seem unjustified.

Price vs Fair Value

M is trading at a 21% discount.
Price
$19.63
Fair Value
$35.00
Uncertainty
Very High
1-Star Price
$83.28
5-Star Price
$66.10
Economic Moat
Kxnl
Capital Allocation
Yxlldbfw

Bulls Say, Bears Say

Bulls

Macy’s owns significant real estate that can be sold to provide liquidity, pay down debt, and finance new investments. This real estate portfolio has brought interest from potential buyers of the company.

Bears

As sales shift to online and discount retailers, Macy’s remains stuck with too many large, mall-based stores. Many of the malls that house Macy’s stores may not be viable in the long run.

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News

Trading Information

Previous Close Price
$19.85
Day Range
$19.6519.94
52-Week Range
$10.5522.08
Bid/Ask
$19.80 / $19.81
Market Cap
$5.43 Bil
Volume/Avg
509,274 / 8.3 Mil

Key Statistics

Price/Earnings (Normalized)
5.78
Price/Sales
0.23
Dividend Yield (Trailing)
3.37%
Dividend Yield (Forward)
3.50%
Total Yield
4.07%

Company Profile

Founded in 1858 and based in New York City, Macy’s operates about 550 stores under the Macy’s nameplate, nearly 60 stores under the Bloomingdale’s (full-price and outlet) and Bloomie's nameplates, and 158 freestanding Bluemercury specialty beauty stores. Macy’s also operates e-commerce sites and licenses two Bloomingdale’s stores in the United Arab Emirates and Kuwait. Women’s apparel, accessories, shoes, cosmetics, and fragrances composed 61% of Macy’s 2022 sales.
Sector
Consumer Cyclical
Industry
Department Stores
Stock Style Box
Small Value
Total Number of Employees
85,581

Competitors

Valuation

Metric
M
TGT
ROST
Price/Earnings (Normalized)
5.7819.5629.15
Price/Book Value
1.326.0010.17
Price/Sales
0.230.752.44
Price/Cash Flow
2.8810.6620.54
Price/Earnings
M
TGT
ROST

Financial Strength

Metric
M
TGT
ROST
Quick Ratio
0.300.271.06
Current Ratio
1.370.911.70
Interest Coverage
1.6311.5527.66
Quick Ratio
M
TGT
ROST

Profitability

Metric
M
TGT
ROST
Return on Assets (Normalized)
5.76%8.02%13.30%
Return on Equity (Normalized)
23.45%35.66%41.75%
Return on Invested Capital (Normalized)
11.22%15.13%17.00%
Return on Assets
M
TGT
ROST
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