Macy’s: Strong Performance Overshadowed by Valuation Concerns
BTIG analyst Robert Drbul maintains a Hold rating on Macy's stock, citing strong performance but valuation concerns. Macy's has exceeded expectations in revenue and earnings for three consecutive quarters, benefiting from its multi-brand strategy. However, the stock's current valuation, with a P/E ratio of 10.5 times the 2026 EPS estimate, is higher than its historical average. Drbul advises waiting for a better entry point. Telsey Advisory also maintains a Hold rating with a $25 price target.
BTIG analyst Robert Drbul has maintained their neutral stance on M stock, giving a Hold rating today.
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Robert Drbul’s rating is based on a combination of factors that reflect both positive performance and valuation concerns. Macy’s has shown encouraging results with three consecutive quarters of exceeding expectations in both revenue and earnings. The company’s Bold New Chapter strategy appears to be effective, as evidenced by the growth in comparable sales and the benefits of being a multi-brand, multi-category, and multi-channel retailer.
However, despite these positive developments, the stock’s current valuation presents a challenge. The stock is trading at a premium compared to its historical average, with a price-to-earnings ratio of 10.5 times the 2026 EPS estimate, which is higher than its five-year average of 7.4 times. Given the recent 30% increase in the stock price, Drbul suggests waiting for a more favorable entry point before considering a more bullish stance.
In another report released today, Telsey Advisory also maintained a Hold rating on the stock with a $25.00 price target.
