Macy's (M) Suffers a Larger Drop Than the General Market: Key Insights

Macy's shares fell 4.2% to $19.15, underperforming the market despite a roughly 12.2% gain over the past month. The retailer is set to report earnings Dec. 3, 2025, with consensus estimates calling for a weak quarter—EPS of -$0.14 (down ~450% year-over-year) and revenue of $4.59 billion (down ~3.3%)—and full-year consensus of $2 EPS and $21.37 billion revenue (declines of ~24.2% and 4.1%, respectively). Zacks notes a 2.05% upward revision to the 30‑day EPS consensus, assigns Macy’s a Zacks Rank #1 (Strong Buy) and highlights a forward P/E of about 10.0 versus the industry’s 20.5, suggesting a valuation discount; upcoming results and further estimate revisions are likely to determine near-term share performance.

Analysis

Macy's closed at $19.15 in the latest session, down 4.2% and underperforming the S&P 500's -0.92% daily move, despite a one-month gain of 12.18% versus the Retail-Wholesale sector's 0.48% and the S&P's 1.48%. The intraday underperformance signals investor sensitivity ahead of a material corporate event rather than a sustained reversal of the month's outperformance.

The company is scheduled to report earnings on December 3, 2025, with consensus expectations calling for EPS of -$0.14 (a ~450% decline year-over-year) and quarterly revenue of $4.59 billion (down 3.25% YoY); full-year Zacks consensus is $2.00 EPS and $21.37 billion revenue, representing declines of ~24.24% and ~4.13% respectively. Zacks notes a 2.05% increase in the 30-day consensus EPS estimate and assigns Macy's a Zacks Rank #1 (Strong Buy), indicating recent upward estimate revision momentum.

Valuation-wise Macy's trades at a forward P/E of 10.02 versus the industry's 20.53, implying a sizeable discount that could compress if fundamentals stabilize or estimates continue to rise. Near-term upside is contingent on the December earnings print and subsequent analyst revisions; the expected negative EPS quarter creates a binary risk-reward where beats and positive revisions would likely prompt outperformance while misses or weaker guidance could push shares lower.

Key Decisions for Investors

• Wait for the December 3 earnings release before initiating sizable new positions, as the -$0.14 EPS consensus and revenue decline make the print the primary near-term catalyst
• If constructive on the valuation gap (forward P/E 10.02 vs industry 20.53), consider a staged or modest accumulation tied to positive pre- or post-earnings estimate revisions rather than a full-sized buy today
• Monitor analyst estimate revisions and the Zacks Rank closely over the next 30 days and be prepared to trim or hedge exposure if consensus EPS/revenue trends turn negative