UPDATE: Evercore ISI Upgrades Macy's (M) to Outperform, Removed from Tactical Outperform List

February 16, 2022 5:48 AM EST
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Price: $20.96 +9.91%

Rating Summary:
    11 Buy, 13 Hold, 7 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 8 | Down: 12 | New: 20
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(Updated - February 16, 2022 5:49 AM EST)

Evercore ISI analyst Omar Saad upgraded Macy's (NYSE: M) from In Line to Outperform with a price target of $50.00. The stock was removed from the Tactical Outperform List.

The analyst comments "This is not a stock for the faint of heart. In a downside scenario (slowing demand, rising inventories, etc.), it’s not hard to imagine Macy’s returning to its pre-pandemic depressed EPS of $2.50 and staying stuck at a 6x P/E multiple, which equates to a $15 stock price, or ~40% downside from current levels. However, we think the risk-reward is asymmetric, and the company could generate $15-20 of EPS long-term and trade at a 10x P/E multiple. Lastly, medium- and long-term expectations for Macy’s are so low; we don’t think the company needs to generate $20 EPS to work as a stock, but rather if it can just sustain its 2021 sales, margin, and EPS levels, the FCF alone will support the shares. We are upgrading Macy’s from In-Line to Outperform and simultaneously removing it from our Tactical Outperform List."

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 $25.43 yesterday.

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