MACY'S INC (M) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:M - US55616P1049 - Common Stock
20.325 USD
-0.21 (-1.05%)
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 valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- In the past year M was profitable.
- M had a positive operating cash flow in the past year.
- M had positive earnings in 4 of the past 5 years.
- In the past 5 years M always reported a positive cash flow from operatings.
1.2 Ratios
- M's Return On Assets of 2.80% is in line compared to the rest of the industry. M outperforms 56.67% of its industry peers.
- With a decent Return On Equity value of 11.04%, M is doing good in the industry, outperforming 63.33% of the companies in the same industry.
- M has a Return On Invested Capital (6.20%) which is in line with its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for M is in line with the industry average of 9.29%.
| 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
- M has a Profit Margin of 2.10%. This is comparable to the rest of the industry: M outperforms 56.67% of its industry peers.
- M's Profit Margin has improved in the last couple of years.
- Looking at the Operating Margin, with a value of 4.00%, M is in line with its industry, outperforming 50.00% of the companies in the same industry.
- In the last couple of years the Operating Margin of M has declined.
- M has a Gross Margin of 40.38%. This is in the lower half of the industry: M underperforms 63.33% of its industry peers.
- In the last couple of years the Gross Margin of M has remained more or less at the same level.
| 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.
- Compared to 1 year ago, M has more shares outstanding
- The number of shares outstanding for M has been reduced compared to 5 years ago.
- Compared to 1 year ago, M has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 2.40 indicates that M is not a great score, but indicates only limited risk for bankruptcy at the moment.
- The Altman-Z score of M (2.40) is comparable to the rest of the industry.
- M has a debt to FCF ratio of 3.05. This is a good value and a sign of high solvency as M would need 3.05 years to pay back of all of its debts.
- M has a better Debt to FCF ratio (3.05) than 73.33% of its industry peers.
- M has a Debt/Equity ratio of 0.56. This is a neutral value indicating M is somewhat dependend on debt financing.
- The Debt to Equity ratio of M (0.56) is worse than 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 3.05 | ||
| Altman-Z | 2.4 |
ROIC/WACC0.73
WACC8.45%
2.3 Liquidity
- A Current Ratio of 1.25 indicates that M should not have too much problems paying its short term obligations.
- With a Current ratio value of 1.25, M is not doing good in the industry: 70.00% of the companies in the same industry are doing better.
- M has a Quick Ratio of 1.25. This is a bad value and indicates that M is not financially healthy enough and could expect problems in meeting its short term obligations.
- With a Quick ratio value of 0.18, M is not doing good in the industry: 90.00% of the companies in the same industry are doing better.
| 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.
- The Earnings Per Share has been decreasing by -1.93% on average over the past years.
- The Revenue has decreased by -2.83% in the past year.
- Measured over the past years, M shows a decrease in Revenue. The Revenue has been decreasing by -1.91% on average per year.
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
- The Earnings Per Share is expected to grow by 0.62% on average over the next years.
- 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
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- M is valuated reasonably with a Price/Earnings ratio of 8.26.
- Based on the Price/Earnings ratio, M is valued cheaply inside the industry as 93.33% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Earnings ratio of 27.30, M is valued rather cheaply.
- The Price/Forward Earnings ratio is 9.01, which indicates a very decent valuation of M.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of M indicates a rather cheap valuation: M is cheaper than 83.33% of the companies listed in the same industry.
- M is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.32, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.26 | ||
| Fwd PE | 9.01 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, M is valued cheaper than 90.00% of the companies in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of M indicates a rather cheap valuation: M is cheaper than 86.67% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.76 | ||
| EV/EBITDA | 4.12 |
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 3.38%.
- M's Dividend Yield is rather good when compared to the industry average which is at 2.19. M pays more dividend than 93.33% of the companies 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 | 3.38% |
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.