Summary of Key Points Core Viewpoint - Macy's Inc (NYSE:M) stock is facing significant resistance around the $12.60 level, which has limited gains for the past couple of months, and the 100-day moving average is also exerting overhead pressure, indicating potential downturns in the future [1] Group 1: Stock Performance - The stock is currently trading at $12.59, reflecting a 1.1% increase [1] - Since reaching a four-year low of $9.76 on April 8, Macy's stock has struggled to recover and is down approximately 26% year-to-date [3] Group 2: Technical Indicators - The stock is within 0.75 of the 100-day moving average's 20-day average true range (ATR), having spent over 80% of the last 10 days and two months above this level [2] - Historical data shows that after similar technical signals in the past three years, Macy's stock was lower one month later 80% of the time, averaging a 7.8% loss, which would place the shares at approximately $11.61 if this trend continues [2] Group 3: Options Market Sentiment - There is a potential unwinding of optimism among options traders, as indicated by a high 10-day call/put volume ratio of 7.47, which ranks higher than 86% of readings from the past year [3]

Market Outlook & Investment Strategy - The firm suggests rotating into value and small-cap stocks, as they have underperformed in the first half of the year [5] - The firm is at target for large-cap stocks but overweight in small-cap and non-US equities, believing there is better value in these areas for the second half of the year [6] - The firm has been bullish on Japan for a number of years due to strong improvements in corporate governance and better returns for shareholders [7] Currency & Economic Factors - The dollar index was down 11% in the first half of the year, marking its worst performance since 1973 [7] - The firm anticipates potential dollar weakness, especially if the Federal Reserve reduces rates by 100 basis points over the next year [8][9] - A softening dollar is seen as a reason to be overweight in developed markets outside the US [10] - Fiscal stimulus in Europe, particularly in Germany, is expected to be beneficial [6] Sector Analysis - There was a rotation out of higher multiple sectors like tech and AI into lower multiple sectors like consumer discretionary [2] - Financials are favored due to the prospect of less stringent regulation and potential capital returns [15][16] - The firm believes that progrowth policies and less regulation will benefit small and mid-cap companies more significantly [13] Risk Factors - Headline risk related to tariffs, particularly with Japan and China, remains a concern [16][17][18]

Group 1 - Macy's shares have declined approximately 6.9% over the past month, underperforming the S&P 500 index [1] - Recent estimates for Macy's have trended downward, with a consensus estimate shift of -43.04% [2] - The stock has an average Growth Score of C, a Momentum Score of F, and a Value Score of A, resulting in an aggregate VGM Score of B [3] Group 2 - The overall outlook for Macy's indicates a downward shift in estimates, leading to a Zacks Rank of 4 (Sell) and expectations of below-average returns in the coming months [4] - Macy's is part of the Zacks Retail - Regional Department Stores industry, where Dillard's has gained 2.7% over the past month [5] - Dillard's reported revenues of $1.53 billion for the last quarter, reflecting a year-over-year decline of -1.3%, with an EPS of $10.39 compared to $11.09 a year ago [5] - For the current quarter, Dillard's is expected to post earnings of $3.47 per share, indicating a change of -24.4% from the previous year, with a Zacks Consensus Estimate change of +2.3% over the last 30 days [6]

Group 1 - The number of job cuts announced in the first five months of 2025 increased by 80% compared to the same period in 2024, totaling approximately 696,000 job cuts [1][2] - Job cuts are only 65,000 away from matching the total for all of 2024, which was just over 385,000 [1] - Economic and market conditions, along with federal funding cuts, are significant factors contributing to the increase in layoffs [2][4] Group 2 - Retail job cuts reached nearly 76,000 for the year, marking a 274% increase over 2024, making it the second-highest industry for job cuts after the federal government [4] - Store closures have been a major contributor to job losses, with several retailers shutting down locations due to economic pressures [6] - Notable retailers such as JCPenney, Macy's, and Forever 21 have announced store closures, with Forever 21 winding down its business primarily due to competition [7][8]

Financial Performance - Net sales for the first quarter of 2025 decreased by $247 million, or 5.1%, compared to the first quarter of 2024, primarily due to the closure of 64 non-go-forward locations[85]. - Macy's, Inc. comparable sales declined 2.0% on an owned basis and 1.2% on an owned-plus-licensed-plus-marketplace basis in the first quarter of 2025[82]. - Bloomingdale's comparable sales increased 3.0% on an owned basis and 3.8% on an owned-plus-licensed-plus-marketplace basis in the first quarter of 2025[84]. - The Company reported net sales of $171 million and an operating loss of $361 million for the 13 weeks ended May 3, 2025[110]. - Comparable sales decreased by 2.0% on an owned basis and 1.2% on an owned-plus-licensed-plus-marketplace basis for the 13 weeks ended May 3, 2025[115]. - Adjusted EBITDA for the 13 weeks ended May 3, 2025, was $324 million, compared to $364 million for the same period in 2024[117]. - The Company reported a net loss of $48 million for the 13 weeks ended May 3, 2025[110]. Expenses and Margins - Gross margin for the first quarter of 2025 was $1,804 million, maintaining a gross margin rate of 39.2%[87]. - Selling, general and administrative expenses increased by $2 million, or 0.1%, in the first quarter of 2025 compared to the first quarter of 2024[87]. - The company incurred impairment, restructuring, and other costs amounting to $7 million, which impacted earnings by $0.03 per share[120]. - Losses on early retirement of debt were recorded at $3 million, with no impact on earnings per share for the previous year[120]. - The income tax impact of certain items was a reduction of $2 million, affecting earnings by $0.01 per share[120]. Cash and Investments - The Company ended the first quarter of 2025 with a cash and cash equivalents balance of $932 million, an increase of $56 million from $876 million at the end of the first quarter of 2024[95]. - The Company’s investments in subsidiaries amounted to $9,914 million as of May 3, 2025[108]. Shareholder Returns and Debt Management - The Company paid dividends totaling $51 million in 2025, compared to $48 million in 2024[99]. - The Board of Directors authorized a new $2,000 million share repurchase program, with $1,274 million remaining available as of May 3, 2025[100]. - Macy's amended its asset-based credit facility, reducing it from $3,000 million to $2,100 million and extending the maturity date to April 2030, providing access to committed liquidity for the next five years[101]. - The total aggregate principal amount of senior unsecured notes outstanding was $2,785 million as of May 3, 2025[107]. - The Company had no outstanding borrowings under the ABL Credit Facility as of May 3, 2025[105]. Tax and Effective Rate - The effective tax rate for the first quarter of 2025 was 44.1%, compared to 36.7% for the first quarter of 2024[91]. - For the 13 weeks ended May 3, 2025, the net income per share was $0.13, down from $0.22 for the same period in 2024, representing a decrease of 40.91%[120]. - The adjusted net income per share, excluding certain items, was $0.16 for the current period, compared to $0.27 in the prior year, reflecting a decline of 40.74%[120]. Market Risk - There have been no material changes to the company's market risk as described in the 2024 10-K filing[121].

Core Viewpoint - Macy's is planning to raise prices on select products due to global tariffs, while also taking measures to reduce exposure to China and renegotiate supplier orders [1][3][5]. Group 1: Company Strategy - CEO Tony Spring indicated that the company is minimizing the impact of tariffs by renegotiating orders and canceling or delaying those that do not meet value expectations [1]. - The company is adopting a "surgical" approach to tariffs, implementing selective price increases in categories where customer value remains strong [2]. - Macy's is closely monitoring sourcing options in Southeast Asia and Europe, while maintaining limited exposure to Canada and Mexico [5]. Group 2: Financial Impact - The company estimates that tariffs will affect its annual gross margin by approximately 20 to 40 basis points, influenced by inventory purchased under a previous 145% levy on China [6]. - Macy's has cut its full-year profit guidance due to the impact of tariffs, a slowdown in consumer discretionary spending, and increased competition [7]. - The adjusted earnings per share forecast for fiscal 2025 has been lowered to a range of $1.60 to $2, down from a previous estimate of $2.05 to $2.25 [8]. Group 3: Industry Context - Macy's is among several retailers facing challenges from the ongoing trade war, with competitors like Target also reporting revenue declines and adjusting guidance due to tariff uncertainties [10]. - Walmart has also warned of potential price hikes due to the significant impact of tariffs on retail margins [11][13].

Core Insights - Macy's, Inc. reported first-quarter fiscal 2025 results with both top and bottom lines exceeding Zacks Consensus Estimates, although both metrics declined compared to the previous year [1][3] Financial Performance - Adjusted earnings were 16 cents per share, surpassing the Zacks Consensus Estimate of 14 cents, but down 40.7% from 27 cents in the prior year [3] - Net sales reached $4,599 million, exceeding the consensus estimate of $4,458 million, but decreased by 5.1% year over year [3] - Comparable sales fell by 2% on an owned basis and 1.2% on an owned-plus-licensed-plus-marketplace basis compared to the previous year [3] Brand Performance - Macy's brand comps declined by 2.9% on an owned basis and 2.1% on an owned-plus-licensed-plus-marketplace basis [6] - Bloomingdale's brand saw a 3% increase in comps on an owned basis and 3.8% on an owned-plus-licensed-plus-marketplace basis [6] - Bluemercury brand experienced a 1.5% increase in comps on an owned basis, marking the 17th consecutive quarter of growth [6] Margins and Expenses - Gross margin remained flat at 39.2%, with improved merchandise margins offset by increased delivery expenses [7] - Selling, general and administrative (SG&A) expenses were $1.91 billion, up 0.1% year over year, with SG&A as a percentage of total revenues rising 170 basis points to 39.9% [8][9] - Adjusted EBITDA was $324 million, down 11% from $364 million in the prior year, with an adjusted EBITDA margin of 6.8%, down 50 basis points year over year [9] Cash and Equity Overview - The company ended the quarter with cash and cash equivalents of $932 million and long-term debt of $2.77 billion [10] - Merchandise inventories declined by 0.5% year over year [10] - The company repurchased 8.7 million shares for $101 million, with $1.3 billion remaining under its $2 billion share repurchase authorization [11] Guidance for Fiscal 2025 - Macy's updated its annual guidance, expecting net sales between $21 billion and $21.4 billion for fiscal 2025 [14] - Comparable owned-plus-licensed-plus-marketplace sales are projected to decline by 0.5-2% year over year [15] - Adjusted earnings per share are expected to be between $1.60 and $2.00, down from the previous estimate of $2.05-$2.25 [16]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced news journalists who produce independent content across various financial markets [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The content delivered by the team includes insights into sectors such as biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all published content is edited and authored by humans [5]

Core Viewpoint - Macy's has reduced its annual profit forecast due to the impact of tariffs and a slowdown in consumer spending, indicating a cautious outlook for the retail sector [1][3][4] Financial Performance - The company now expects adjusted earnings per share of $1.60 to $2 for 2025, down from a previous forecast of $2.05 to $2.25, with 15 to 40 cents of the drop attributed to tariffs [1][3] - Macy's reaffirmed its annual sales forecast of $21 billion to $21.4 billion, a decline from last year's $22.29 billion [4] - For the three months ended May 3, adjusted earnings per share were reported at 16 cents, beating projections of 14 cents, while revenue was $4.6 billion, above expectations of $4.5 billion [4] Market Challenges - The company faces challenges from a slowdown in consumer spending and increased competition in promotions and discounts across the retail industry [3][8] - Comparable sales at Macy's locations fell 0.8% compared to the same period last year, while same-store sales at Bloomingdale's and Bluemercury increased by 3.8% and 1.5%, respectively [7][9] Strategic Initiatives - Macy's is undergoing a three-year turnaround plan, which includes closing 150 locations by early 2027 and enhancing its Bluemercury and Bloomingdale's businesses [5][6] - The company has invested in staffing, improved displays, and a new merchandise mix at 125 locations, which is about one-third of the stores it plans to keep open [6][11] Stock Performance - Macy's shares have decreased by approximately 27% so far this year [10][13]

Group 1 - Macy's, Inc. (NYSE: M) has experienced a significant decline in share price, losing 41% over the past year [1] - Investors are dissatisfied with the slow pace of the company's turnaround efforts, particularly after it rejected a buyout offer [1] - The company has a history of making contrarian bets based on macro views and stock-specific turnaround stories to achieve outsized returns [1]