Macy's (M) Stock Forecast & Price Target

Macy's has updated its FY25 earnings per share (EPS) guidance to a range of $1.70 to $2.05, reflecting an upward revision from the previous forecast of $1.60 to $2.00, indicating improved profitability expectations. The company has also reported a 1.2% improvement in comparable sales on an owned plus-licensed-plus-marketplace basis, demonstrating a positive trend in customer demand and engagement. Additionally, Macy's achieved its highest-ever second quarter net promoter score, suggesting enhanced customer satisfaction which may further contribute to future sales growth.

Macy's is experiencing a decline in sales driven by store rationalization, which negatively impacted net sales by over 300 basis points, translating to a $170 million loss linked to the closure of 64 stores. The expected overall deleverage of SG&A is projected to fall between 60 to 80 basis points for the year, reflecting ongoing challenges in managing operating expenses despite a dollar decline. Additionally, a forecasted contraction of 130 basis points in operating margin to -0.5% highlights persistent pressure on profitability, compounded by potential tariff impacts that may reduce FY25 EPS by $0.25 to $0.40.