mid-cap

One Omni-channel Retailer Trading Near Resistance Levels- M

Dec 12, 2023 | Team Kalkine

Read Time :10 Mins

One Omni-channel Retailer Trading Near Resistance Levels- M

M:NYSE

Investment Type

Mid - Cap

Risk Level

Action

Rec. Price (US$)

This report is the updated version of the report uploaded on 12 December 2023 at 4:47 AM PT

Company Overview:

Macy's Inc. (NYSE: M) is an omnichannel retail company which sells the wide range of merchandise including apparel as well as accessories, cosmetics, home furnishing, and other consumer goods.

Financial Results for Q3 FY 2023

The company has released its financial results for the Q3 FY 2023 and its net sales stood at $5 Bn, down by 7% as compared to the Q3 of 2022. Its comparable sales were down by 7.0% on an owned basis as well as down by 6.3% on an owned-plus-licensed basis.
Its gross margin rate for Q3 stood at 40.3%, reflecting a rise from 38.7% in Q3 FY 2022. Its selling, general and administrative expenses stood at $2.0 Bn, a decline of $48 Mn.
Its digital sales fell 7% as compared to Q3 FY 2022.

Key Updates

Macy’s, Inc. announced that Tracy Preston has been named as the chief legal officer as well as corporate secretary, effective January 8, 2024

Outlook

For FY 2023, the company is expecting net sales in the range of $22.9 Bn - $23.2 Bn and its adjusted diluted EPS of $2.88 - $3.13.

Key Risks

The company is exposed to the risks related to weak global growth, geopolitical tensions, inflationary pressures, decline in consumer confidence, etc.

Fundamental Valuation

P/E Based Relative Valuation

Stock Recommendation

Over the last three months, the stock has given a return of 64.7%. The stock has made a 52-week low and high of USD 10.54 and USD 25.12, respectively. The company’s performance is exposed to the risks related to the global slowdown as well as geopolitical tensions. Therefore, investors should exit the stock.

Hence, a ‘Sell’ rating has been provided on the stock at the closing price of USD20.77 per share, up by 19.44% as on 11^th December 2023.

Technical Overview:

Markets are trading in a highly volatile zone currently due to certain macro-economic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Small-Cap

Watch Out for One NASDAQ- Listed Biotechnology Services Stock – Inotiv Inc