Macy's (M) Down In Pre-Market Trading

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Macy's ( M) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Macy's as such a stock due to the following factors:

  • M has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $268.9 million.
  • M traded 54,054 shares today in the pre-market hours as of 8:17 AM.
  • M is down 3.3% today from yesterday's close.

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More details on M:

Macy's, Inc., together with its subsidiaries, operates stores and Internet Websites in the United States. Its stores and Websites sell a range of merchandise, including apparel and accessories for men, women, and children; cosmetics; home furnishings; and other consumer goods. The stock currently has a dividend yield of 1.9%. M has a PE ratio of 16. Currently there are 7 analysts that rate Macy's a buy, 1 analyst rates it a sell, and 8 rate it a hold.

The average volume for Macy's has been 4.0 million shares per day over the past 30 days. Macy's has a market cap of $22.5 billion and is part of the services sector and retail industry. The stock has a beta of 0.82 and a short float of 4.4% with 3.45 days to cover. Shares are up 0.3% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Macy's as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, solid stock price performance, growth in earnings per share and expanding profit margins. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 2.1%. Since the same quarter one year prior, revenues slightly increased by 1.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Multiline Retail industry and the overall market, MACY'S INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • MACY'S INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, MACY'S INC increased its bottom line by earning $4.27 versus $3.90 in the prior year. This year, the market expects an improvement in earnings ($4.75 versus $4.27).
  • 40.31% is the gross profit margin for MACY'S INC which we consider to be strong. Regardless of M's high profit margin, it has managed to decrease from the same period last year.

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