MACY'S INC (M) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:M - US55616P1049 - Common Stock
20.38 USD
+0.12 (+0.59%)
20.3 USD
-0.08 (-0.39%)
M gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 30 industry peers in the Broadline Retail industry. Both the profitability and the financial health of M get a neutral evaluation. Nothing too spectacular is happening here. M is cheap, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- In the past year M was profitable.
- In the past year M had a positive cash flow from operations.
- M had positive earnings in 4 of the past 5 years.
- Each year in the past 5 years M had a positive operating cash flow.
1.2 Ratios
- Looking at the Return On Assets, with a value of 2.80%, M is in line with its industry, outperforming 56.67% of the companies in the same industry.
- M's Return On Equity of 11.04% is fine compared to the rest of the industry. M outperforms 63.33% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 6.20%, M is in line with its industry, outperforming 56.67% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for M is in line with the industry average of 9.28%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.8% | ||
| ROE | 11.04% | ||
| ROIC | 6.2% |
ROA(3y)3.54%
ROA(5y)-0.71%
ROE(3y)13.99%
ROE(5y)-14.6%
ROIC(3y)8.23%
ROIC(5y)N/A
1.3 Margins
- The Profit Margin of M (2.10%) is comparable to the rest of the industry.
- In the last couple of years the Profit Margin of M has grown nicely.
- M has a Operating Margin of 4.00%. This is comparable to the rest of the industry: M outperforms 50.00% of its industry peers.
- M's Operating Margin has declined in the last couple of years.
- With a Gross Margin value of 40.38%, M is not doing good in the industry: 63.33% of the companies in the same industry are doing better.
- M's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4% | ||
| PM (TTM) | 2.1% | ||
| GM | 40.38% |
OM growth 3Y-23.39%
OM growth 5Y-2.37%
PM growth 3Y-23.51%
PM growth 5Y2.59%
GM growth 3Y-0.48%
GM growth 5Y0.08%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so M is destroying value.
- M has more shares outstanding than it did 1 year ago.
- The number of shares outstanding for M has been reduced compared to 5 years ago.
- M has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.39 indicates that M is not a great score, but indicates only limited risk for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 2.39, M is in line with its industry, outperforming 60.00% of the companies in the same industry.
- The Debt to FCF ratio of M is 3.05, which is a good value as it means it would take M, 3.05 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 3.05, M is in the better half of the industry, outperforming 73.33% of the companies in the same industry.
- M has a Debt/Equity ratio of 0.56. This is a neutral value indicating M is somewhat dependend on debt financing.
- M's Debt to Equity ratio of 0.56 is on the low side compared to the rest of the industry. M is outperformed by 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 2.39 |
ROIC/WACC0.73
WACC8.45%
2.3 Liquidity
- M has a Current Ratio of 1.25. This is a normal value and indicates that M is financially healthy and should not expect problems in meeting its short term obligations.
- M has a worse Current ratio (1.25) than 70.00% of its industry peers.
- A Quick Ratio of 0.18 indicates that M may have some problems paying its short term obligations.
- The Quick ratio of M (0.18) is worse than 90.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.25 | ||
| Quick Ratio | 0.18 |
3. Growth
3.1 Past
- The earnings per share for M have decreased strongly by -25.23% in the last year.
- Measured over the past years, M shows a decrease in Earnings Per Share. The EPS has been decreasing by -1.93% on average per year.
- The Revenue has decreased by -2.83% in the past year.
- M shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -1.91% yearly.
EPS 1Y (TTM)-25.23%
EPS 3Y-21.03%
EPS 5Y-1.93%
EPS Q2Q%125%
Revenue 1Y (TTM)-2.83%
Revenue growth 3Y-3.11%
Revenue growth 5Y-1.91%
Sales Q2Q%-0.61%
3.2 Future
- Based on estimates for the next years, M will show a small growth in Earnings Per Share. The EPS will grow by 0.62% on average per year.
- M is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -2.90% yearly.
EPS Next Y-16.11%
EPS Next 2Y-7.54%
EPS Next 3Y-4.21%
EPS Next 5Y0.62%
Revenue Next Year-3.74%
Revenue Next 2Y-2.96%
Revenue Next 3Y-2.9%
Revenue Next 5YN/A
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 8.28 indicates a reasonable valuation of M.
- M's Price/Earnings ratio is rather cheap when compared to the industry. M is cheaper than 96.67% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 28.87. M is valued rather cheaply when compared to this.
- A Price/Forward Earnings ratio of 9.03 indicates a reasonable valuation of M.
- Based on the Price/Forward Earnings ratio, M is valued cheaper than 83.33% of the companies in the same industry.
- M is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.96, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.28 | ||
| Fwd PE | 9.03 |
4.2 Price Multiples
- M's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. M is cheaper than 90.00% of the companies in the same industry.
- 86.67% of the companies in the same industry are more expensive than M, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.77 | ||
| EV/EBITDA | 4.08 |
4.3 Compensation for Growth
- M's earnings are expected to decrease with -4.21% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-7.54%
EPS Next 3Y-4.21%
5. Dividend
5.1 Amount
- M has a Yearly Dividend Yield of 3.55%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.35, M pays a better dividend. On top of this M pays more dividend than 96.67% of the companies listed in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, M pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.55% |
5.2 History
- The dividend of M decreases each year by -14.37%.
- M has been paying a dividend for at least 10 years, so it has a reliable track record.
- M has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-14.37%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
- M pays out 41.21% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP41.21%
EPS Next 2Y-7.54%
EPS Next 3Y-4.21%
MACY'S INC / M FAQ
What is the ChartMill fundamental rating of MACY'S INC (M) stock?
ChartMill assigns a fundamental rating of 4 / 10 to M.
What is the valuation status of MACY'S INC (M) stock?
ChartMill assigns a valuation rating of 7 / 10 to MACY'S INC (M). This can be considered as Undervalued.
What is the profitability of M stock?
MACY'S INC (M) has a profitability rating of 4 / 10.
Can you provide the financial health for M stock?
The financial health rating of MACY'S INC (M) is 4 / 10.
What is the expected EPS growth for MACY'S INC (M) stock?
The Earnings per Share (EPS) of MACY'S INC (M) is expected to decline by -16.11% in the next year.