Macy's (M) Upgraded to Strong Buy: Here's Why

Core Viewpoint - Macy's has been upgraded to a Zacks Rank 1 (Strong Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system focuses on the consensus measure of EPS estimates from sell-side analysts, which reflects the company's changing earnings picture [1][2]. - Changes in future earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements, particularly influenced by institutional investors [4]. Business Outlook for Macy's - The rising earnings estimates and the Zacks rating upgrade suggest an improvement in Macy's underlying business, which could lead to increased stock prices as investors respond positively [5][10]. - For the fiscal year ending January 2026, Macy's is expected to earn $2.08 per share, with a 12.5% increase in the Zacks Consensus Estimate over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Only the top 5% of Zacks-covered stocks receive a "Strong Buy" rating, indicating superior earnings estimate revisions and potential for market-beating returns [9][10].