Deutsche Bank Upgrades Macy's (M) to Buy

October 31, 2016 6:48 AM EDT
Get Alerts M Hot Sheet
Price: $29.63 -0.24%

Rating Summary:
    8 Buy, 20 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 24 | Down: 17 | New: 14
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Deutsche Bank upgraded Macy's (NYSE: M) from Hold to Buy with a price target of $45.00 (prior $40.00). Analyst Paul Trussell balanced his models to better reflect the tougher top-line environment and margin recovery opportunity.

"We recognize near-term comp pressure but also significant 4Q and 2017 GPM opportunity buoying our EPS estimates above the Street. We think investors are underestimating the recovery potential, while we remain conservative on apparel SSS and real estate which could provide further upside. We think M is efficiently clearing excess inventory through Last Act (among the busiest parts of the store in our checks), and fewer but stronger promotional events plus sharper pricing are driving traffic while still preserving GPM. Next year’s store rationalization (100 closures announced) should further augment margins," said the analyst.

For an analyst ratings summary and ratings history on Macy's click here. For more ratings news on Macy's click here.

Shares of Macy's closed at $35.56 yesterday.

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