How much is Macy’s worth? The value of America’s largest store

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With revenues of nearly $25.3 billion, Macy’s is one of the largest and oldest department stores in the United States. But how much is the retailer worth? Here is an overview of his finances.

Macy’s Finances

Company overview
Headquarter New York City
Year of foundation 1858
Founder Rowland Hussey Macy
CEO Jeffrey Gennette

A measure used by analysts to determine a company’s value is market capitalization, or the total value of all shares in the company. As of May 2022, Macy’s value based on market cap was approximately $6.75 billion.

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Macy’s book value—or the sum of assets minus liabilities, divided by the number of shares—was approximately $12 per share in the spring of 2022, bringing the stock price-to-book ratio to about 2.3. This number represents a decline from the price-to-book ratio of around 2.5 that Macy’s reached in October 2021. As the price-to-book value declines, a company’s stock generally becomes cheaper, which means that the stock market is reducing the value it attributes to futures contracts. turnover and net profit.

Share price

Like many brick-and-mortar retail stores, Macy’s struggled through the COVID-19 pandemic, with its stock price – which had hovered around $20 for a while – dropping to around $5 during the 2020 recession. By April 2022, however, Macy’s stock had rallied to around $24 per share, midway between a 52-week high of $37.95 and a low of $15.55.

Over the past few quarters, Macy’s has had some positive surprises in store for retail analysts. Throughout 2020 and 2021, the company reported better-than-expected earnings in every quarter. Earnings per share for the first quarter of 2022 are expected to reach $0.79, continuing a strong upward trend in net income over the past year.

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Financial overview
Market capitalization About $6.75 billion
Stock price, 52 week range $15.55 to $37.95
Revenue for the 2021 financial year $17.3 billion
Net income for the 2021 financial year $1.4 billion
Adjusted diluted earnings per share for fiscal year 2022 $4.13 to $4.52

Good to know

Companies in good financial health sometimes announce share buybacks, in which the company uses its own cash to buy and “withdraw” its own shares. This reduces the number of shares outstanding and generally increases net income per share.

Recent Finances

Macy’s reported net earnings per share of $2.45 for the most recent quarter ending December 2021. Analyst consensus for that period was $1.99, meaning the company made a significant gain.

Revenue also beat expectations, with Macy’s reporting nearly $8.7 billion in sales against an analyst consensus of about $8.45 billion. The result represents a 27.8% year-over-year increase from the last quarter of 2020.

The retail industry is constantly changing, with businesses opening new stores and closing unprofitable branches on a regular basis. For this reason, retail analysts use comparable store comparable sales to more accurately measure growth. The 2021 figure for Macy’s represented a 28.3% increase from the previous year and a 6.6% increase from 2019, the last non-pandemic year.

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Another key financial metric is gross margin, which increased from 33.7% to 36.5% from 2021 to 2022. Free cash flow was reported at $2.3 billion, debt payment increased reduced the company’s debt ratio and Macy’s dividend was increased by 5%.

Macy’s Top 10 Shareholders

Mutual funds and private fund management companies hold large stakes in Macy’s, although only BlackRock and Vanguard hold more than 10% of the outstanding shares. In early 2022, the largest deals in Macy’s stock were bought by Vanguard and Nordea Investment Management.

Institutional ownership of Macy’s stock is high at 87%. When a large percentage of shares are in the hands of institutions such as banks, insurance companies and mutual funds, the share price tends to be relatively stable because these companies do not buy or sell stocks infrequently.

Here’s a look at Macy’s major shareholders as of April 2022.

Shareholder Stake
BlackRock Fund Advisors 10.96%
The vanguard group 10.07%
SSGA fund management 4.11%
Appaloosa LP 3.45%
Newport Trust 2.74%
Arrowstreet Capital 2.72%
Dimensional Fund Advisors 2.64%
Geode Capital Management 1.93%
Contrarius Portfolio Management 1.86%
Northern Trust Investments 1.60%

Macy’s Humble Origins

Founded by former sailor turned businessman Rowland H. Macy’s, Macy’s began in 1858 as a dry goods store located on 14th Street and Sixth Avenue in Manhattan, NY In its own history, Macy’s proudly tells its lowly first-day sales of $11.06, as well as first-year revenue of $85,000.

Over the years, the store has become a shopping icon in New York City, where it pioneered window shopping, on-site tailoring, and department store Santas. In 1902 Macy’s moved its flagship store to Herald Square, 34th Street and Broadway. The store remained open for business at this busy location, which also serves as the company’s headquarters.

Navigate in a competitive environment

Macy’s became a national retail franchise in the 20th century and has long been a familiar presence in malls across the country. Hard times came in the 1990s, however, when competition and heavy debt forced Macy’s into bankruptcy.

Around this time, corporate department stores were competing with Amazon’s online shopping experience and the “retail apocalypse,” in which department stores were losing their appeal as well. than their foot traffic, and the public increasingly sought out homewares, clothing, cosmetics. and other discretionary items at home.

After a merger with Federated Department Stores, Macy’s returned to profitability. In 2007, Federated renamed itself Macy’s and the company grew into a giant retail holding company that included Bloomingdale’s and nearly 200 other specialty retail stores. In the difficult pandemic year of 2020, Macy’s topped all department store retailers with $24.6 billion in revenue. That revenue declined the following year, dropping about 29.7% to $17.3 billion in 2021.

Macy’s vs the competition

Researching a company means comparing it to companies of the same size and in the same investment sector. For Macy’s, the nation’s leading omnichannel retailer, rivals for a good comparison include Nordstrom and Kohl’s.

With revenues of approximately $14.8 billion, Nordstrom’s market capitalization is approximately $4.1 billion. By comparison, Kohl’s weighs a little more, with revenue of around $19.4 billion and a market capitalization of nearly $7.3 billion.

Among these competitors, Macy’s stands out by the recommendations of analysts. A major platform for individual investors, Fidelity offers a wealth of data on this point for those looking for public companies. The stock summary score – Fidelity’s popular measure of investment strength – was up 8.5 for Macy’s in April 2022, with three buy recommendations, four neutrals and one sell. The same measurement was six (neutral) for Nordstrom and 7.5 for Kohl’s.

Look forward

Despite a return to profitability and a string of positive earnings reports through 2021, Macy’s has an uncertain path ahead. A sharp rise in the cost of living that began in early 2022 put many consumers’ spending plans on hold. Discretionary purchases, such as household and leisure products, now compete with other expensive decisions, such as automobiles and travel.

Regular quarterly and annual forecasts of public companies provide financial analysts with an important measure of a company’s health. In February 2022, Macy’s forecast slow or steady growth in sales figures for the coming year. Two months later, the company reported slowing demand for homewares and casual wear — categories that remained strong during the height of the pandemic.

In the spring of 2022, Macy’s announced a $1 billion buyout program in addition to a previously announced $500 million buyout. Continued revenue growth, combined with this significant buyout, should support Macy’s stock value in the coming year.

Information is accurate as of May 5, 2022.

Editorial Note: This content is not provided by Macy’s. Any opinions, analyses, criticisms, ratings, or recommendations expressed in this article are those of the author alone and have not been reviewed, endorsed, or otherwise endorsed by Macy’s.

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About the Author

A writer and editor with over 100 book credits in the teen and young adult non-fiction format, Tom Streissguth has mastered the art of explaining complex and difficult subjects clearly. His books have covered history, geography, economics, media and current affairs; he has also written biographies of historical figures for Lerner, Enslow, Facts on File, Greenhaven, and other major educational publishers.