As of the morning of December 3, 2025, Macy’s, Inc. (NYSE: M) is back in the spotlight. The department store chain delivered a surprise third‑quarter profit, its strongest comparable sales growth in more than three years, and raised full‑year guidance — yet the stock is trading lower after management struck a cautious tone on the all‑important holiday quarter. [1]
Macy’s shares were recently changing hands around $22.55, down about 0.7% on the day and slightly below Tuesday’s close of $22.71. That still leaves the stock near its 52‑week high of $23.15 and up sharply from a 52‑week low of $9.76, giving the retailer a market capitalization of roughly $6.0 billion. [2]
Below is a breakdown of what happened in Q3, how Wall Street is reacting, and what the latest numbers could mean for Macy’s stock going into 2026.
Macy’s Stock Today: Price Action and Basic Valuation
According to real‑time data, Macy’s stock opened the session near $22.55, about 0.7% lower than the prior close. [3] That’s a relatively modest move compared with the 7–7.5% decline in premarket trading reported just after the company issued a cautious holiday outlook, which initially spooked traders. [4]
Key snapshot metrics for Macy’s (M) now include: [5]
- Price: ~$22.55 per share
- Market cap: ~$6.0 billion
- Trailing 12‑month revenue: ~$22.7 billion
- Trailing EPS: $1.71; P/E ratio: ~13x
- Dividend: $0.73 annualized (yield ~3.2%), with the latest quarterly dividend of $0.1824 per share payable on January 2, 2026 to shareholders of record December 15, 2025 [6]
- 52‑week range: $9.76 – $23.15
- Beta: ~1.46–2.17 depending on source, reflecting above‑market volatility [7]
From a longer‑term perspective, the stock has already had a big run. Zacks notes that Macy’s shares are up about 34% year‑to‑date, versus roughly 16% for the S&P 500, even before today’s earnings move. [8]
Q3 2025: Surprise Profit and Best Comps in 13 Quarters
Macy’s third quarter of fiscal 2025 (ended November 1) was objectively better than Wall Street expected.
Headline numbers
- Net sales: about $4.71 billion, down only 0.6% year‑over‑year, but above analyst expectations of roughly $4.56 billion [9]
- Total revenue (including credit & other): ~$4.91 billion [10]
- GAAP net income:$11 million
- GAAP EPS:$0.04
- Adjusted EPS:$0.09, versus a consensus loss of about $0.13 per share — a huge positive surprise [11]
That EPS beat translates into a roughly 169% upside surprise versus expectations, as highlighted by Zacks. [12]
Comparable sales and segment performance
The real highlight for Macy’s stock today is momentum in comparable sales:
- Company‑wide comps:
- +2.5% on an owned basis
- +3.2% on an owned‑plus‑licensed‑plus‑marketplace (O+L+M) basis
- Management said this is the strongest comparable sales growth in 13 quarters and the best top‑line performance in more than three years. [13]
- Macy’s nameplate: modest comp growth, with go‑forward locations (the “Reimagine 125” stores) growing faster than the broader chain. [14]
- Bloomingdale’s: net sales up about 8.6%, with comparable sales up 8.8–9.0%, its best growth in several quarters. [15]
- Bluemercury: net sales up roughly 3.8%, comps up about 1.1%, extending its streak of growth. [16]
Other line items:
- Gross margin: about 39.4%, down 20 basis points year‑over‑year, primarily due to tariffs (roughly a 50 bps headwind) — but still better than Macy’s had feared. [17]
- SG&A expenses: down about $40 million year‑on‑year to ~$2.0 billion, reducing SG&A as a percentage of revenue by 90 basis points to 41.2%. [18]
- Credit card revenue: up ~32% to $158 million, reflecting healthy credit performance. [19]
In short: Macy’s delivered a small profit, beat revenue estimates, and showed broad‑based comp growth across its banners — a sharp contrast to the decline analysts had forecast going into the quarter. [20]
Holiday Quarter Guidance: Caution Offsets the Good News
So why is Macy’s stock down after such a solid quarter?
The answer lies in the fourth‑quarter (holiday) outlook. Management raised full‑year guidance but issued a more conservative view for Q4 than bulls wanted to see.
According to management commentary and analyst summaries: [21]
- Q4 net sales guidance: about $7.35–$7.50 billion, slightly above the Street’s ~$7.34 billion consensus.
- Q4 adjusted EPS guidance:$1.35–$1.55
- The high end of that range matches consensus of roughly $1.55; the midpoint falls short of expectations.
Reuters reported that CEO Tony Spring described the consumer as “more choiceful” — essentially more selective and cautious with discretionary spending after Black Friday and Cyber Monday — and said Macy’s is being prudent in its holiday assumptions. [22]
That cautious tone, combined with a year‑to‑date rally in the stock, is what drove the initial 7–7.5% premarket drop in Macy’s share price before the cash session opened. [23]
Full‑Year 2025 Outlook Raised Again
Despite the cautious near‑term commentary, Macy’s raised its full‑year 2025 guidance for the second time this year, citing momentum from its “Bold New Chapter” turnaround strategy. [24]
New guidance (as of December 3, 2025): [25]
- Net sales:$21.475–$21.625 billion
- Up from prior guidance of $21.15–$21.45 billion
- Comparable sales (O+L+M):
- Now expected to be flat to up ~0.5% versus 2024, versus prior expectations of a decline of 0.5–1.5%
- Go‑forward business comps:
- Now expected to be flat to up ~1.0%, versus previous guidance of down 1.5% to flat
- Adjusted EBITDA margin:7.8–8.0%, slightly above the prior 7.4–7.9% range
- Core Adjusted EBITDA margin:7.5–7.7% (raised from 7.0–7.5%)
- Adjusted diluted EPS:$2.00–$2.20, up from $1.70–$2.05
For context, Zacks had been modeling full‑year EPS of about $2.00 on $21.38 billion in revenue — the bottom of Macy’s new EPS range and slightly below the updated sales outlook. [26]
Even with the raise, AP and other outlets point out that full‑year sales remain below pre‑turnaround levels, reflecting the impact of store closures and a structurally challenged department store category. [27]
Inside the Turnaround: “A Bold New Chapter”
Macy’s current strategy is a three‑year overhaul dubbed “A Bold New Chapter,” launched in early 2024. The plan has three main pillars: [28]
- Strengthening the Macy’s nameplate
- Closing roughly 150 underperforming stores to end with a fleet of about 350 higher‑productivity locations.
- Investing in remodeled “Reimagine 125” stores, which have been outgrowing the rest of the chain in comparable sales. [29]
- Accelerating luxury growth
- Expanding Bloomingdale’s in new markets and formats, including its smaller “Bloomie’s” concept.
- Rebranding and expanding Bluemercury, its specialty beauty chain, via new and remodeled locations. [30]
- Simplifying and modernizing operations
- Rationalizing the real‑estate and supply‑chain footprint.
- Upgrading fulfillment and technology, including the recent opening of a 2.5 million‑square‑foot automated fulfillment center in China Grove, North Carolina — the largest and most automated facility in the company’s history. [31]
Third‑party analyses from sources like eMarketer note that Macy’s Q2 and Q3 results show the plan is starting to work: updated stores are producing better comps, luxury banners are gaining share, and customer experience scores are improving. At the same time, overall department‑store sales in the U.S. remain under pressure, which limits how far Macy’s can swim against the tide. [32]
What Wall Street Is Saying About Macy’s Stock
Despite the strong quarter, Wall Street’s overall stance on Macy’s stock is still cautious.
Consensus ratings and price targets
StockAnalysis data show that: [33]
- The average rating on Macy’s (M) is “Hold.”
- The average 12‑month price target is about $16.67, implying roughly 25–26% downside from the current price around $22.5.
GuruFocus data, which incorporate additional analyst estimates, show a similar story, with average targets near the high‑teens and a recommendation skewed toward Hold/Neutral, despite the recent rally. [34]
Recent analyst moves
Ahead of Q3 results, Benzinga highlighted several notable rating and target changes from highly‑ranked analysts: [35]
- UBS: Sell rating, price target raised from $6.50 to $7 (Dec. 1, 2025).
- Telsey Advisory Group: Market Perform, price target lifted from $17 to $22 (Nov. 28, 2025).
- Citigroup: Neutral, price target increased from $16 to $19 (Nov. 19, 2025).
- Morgan Stanley: Equal‑Weight, target raised from $12 to $16 (Sept. 18, 2025).
- BTIG: Initiated with Neutral (Oct. 15, 2025).
These moves tell a clear story: targets have been moving up, but many analysts still see Macy’s current share price as rich relative to their fair‑value estimates, especially after a big run‑up.
Quant and fundamental views
GuruFocus’ quantitative snapshot adds more nuance: [36]
- P/E: ~13x
- P/S: ~0.28
- P/B: ~1.37 — near the high end of Macy’s historical valuation ranges.
- Altman Z‑Score: ~2.66, in the “grey zone,” indicating some balance‑sheet risk but not distress.
- ROIC vs. WACC: Return on invested capital (~5.8%) sits below its estimated cost of capital, suggesting the company still isn’t fully earning its cost of capital.
- Beta: ~2.17 and annualized volatility above 40%, underscoring that Macy’s stock can swing sharply.
Zacks, meanwhile, assigns a Rank #2 (Buy) based on positive earnings‑estimate revisions, noting that Macy’s has beaten EPS forecasts in four straight quarters and that its industry (Retail – Regional Department Stores) sits in the top 3% of all Zacks industries by relative strength. [37]
Some independent analysts and bloggers are more bullish. A mid‑November Seeking Alpha piece framed Macy’s as modestly undervalued with a potential “breakout moment” driven by holiday demand and the turnaround plan, though those views are not universal and are clearly opinion, not consensus. [38]
Balance Sheet, Capital Returns and Real‑Estate Angle
For investors in Macy’s stock, the balance sheet and capital‑allocation story remain central.
From the Q3 release: [39]
- Cash & cash equivalents: about $447 million
- Undrawn ABL facility: roughly $2.0 billion
- Total debt: around $2.4 billion, with no material long‑term maturities until 2030
- Shareholder returns in Q3:
- $49 million in dividends
- $50 million in share repurchases (~2.8 million shares)
- Year‑to‑date, Macy’s has repurchased about 15.4 million shares for $201 million, with $1.2 billion remaining under its $2.0 billion authorization.
The company’s real estate remains a background storyline. In 2024, activist investors attempted a buyout at roughly $24.80 per share, arguing that Macy’s property portfolio alone was worth $5–9 billion — more than the company’s then‑market value. That proposal was rejected, but commentary from activists and later analyses continue to highlight real estate as a hidden‑asset kicker for Macy’s long‑term valuation. [40]
Key Risks for Macy’s, Inc. Stock
Even after a strong quarter, Macy’s remains a high‑risk, high‑volatility retail name. Some of the main risk factors highlighted across company filings and third‑party research include: [41]
- Cyclical and structural retail headwinds
- Department‑store sales in the U.S. have been declining on a multi‑year basis as shoppers shift online and toward off‑price formats.
- eMarketer notes that even as Macy’s comps turn positive, overall department‑store sales were still down year‑over‑year in early 2025.
- Tariffs and inflation
- Tariff‑related costs shaved roughly 50 basis points off gross margin in Q3 and are expected to remain a headwind, especially if new or higher tariffs appear.
- Consumers remain price‑sensitive and “choiceful,” pressuring promotional intensity and margins.
- Execution risk in the turnaround
- The Bold New Chapter plan involves closing many full‑line stores, building out automation, and shifting more emphasis to luxury and beauty.
- If remodeled stores or new formats fail to deliver sustained productivity gains, Macy’s could end up with lower sales but similar fixed costs.
- Financial and market risk
- While Macy’s has sizable liquidity, its leverage and intermediate‑term debt load mean it must continue generating cash flow to comfortably fund dividends, buybacks and store investments.
- High beta and volatility mean that macro shocks, changes in consumer sentiment, or headline risk (e.g., on tariffs) can move the stock dramatically in either direction.
The Bottom Line for Macy’s (M) Stock After Q3 2025
As of December 3, 2025, Macy’s is sending mixed signals to investors:
- On the positive side, the company:
- Delivered a surprise Q3 profit and broad‑based comp growth, its best in more than three years.
- Raised full‑year guidance on revenue, margins and EPS.
- Showed tangible early payoffs from its Bold New Chapter strategy, particularly in refreshed Macy’s stores and luxury banners. [42]
- On the negative or cautious side:
- Q4 EPS guidance, while solid, is not a blow‑out versus expectations and comes with explicit warnings about “choiceful” consumers. [43]
- Street price targets remain well below the current share price, and most analysts rate the stock Hold/Neutral rather than outright Buy. [44]
- The long‑term structural challenges facing department stores haven’t gone away; Macy’s is improving its position, but it still operates in a shrinking segment. [45]
For now, Macy’s, Inc. stock sits at the intersection of turnaround story and value debate: the quarter shows that the internal transformation is gaining traction, yet today’s share price already discounts a substantial amount of that improvement. Whether the next move in M is higher or lower will depend heavily on the holiday quarter delivery, the macro backdrop in 2026, and the company’s ability to sustain comp growth without sacrificing margins.
References
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