Macy's (M) Expected to Beat Earnings Estimates: Can the Stock Move Higher?

Macy's (M) is widely expected to report a substantial year-over-year earnings decline to $0.19 per share and a 4% revenue drop to $4.74 billion for the quarter ended July 2025. However, Zacks analysis suggests a high probability of an earnings beat, citing a positive Earnings ESP of +7.53% and a Zacks Rank #3, supported by recent upward estimate revisions and a history of beating estimates in three of the last four quarters. This positions Macy's as a compelling earnings-beat candidate ahead of its September 3 report, potentially driving near-term stock movement despite the challenging consensus outlook.

Analysis

Despite a challenging consensus outlook for Macy's (M) upcoming quarterly report, which projects a 64.2% year-over-year earnings decline to $0.19 per share and a 4% revenue drop to $4.74 billion, key proprietary indicators suggest a high probability of an earnings beat. The Zacks Earnings ESP (Expected Surprise Prediction) is a positive +7.53%, indicating that the most recent analyst estimates are more bullish than the broader consensus. This, combined with a Zacks Rank of #3 (Hold), creates a scenario that has historically resulted in a positive earnings surprise nearly 70% of the time. This optimistic short-term outlook is further supported by a recent 8.62% upward revision in the consensus EPS estimate over the last 30 days and the company's track record of beating EPS estimates in three of the last four quarters. However, the fundamental picture of significant top and bottom-line contraction remains a key concern, and the sustainability of any post-earnings stock movement will heavily depend on management's forward-looking guidance.

Key Decisions for Investors

• Given the high statistical likelihood of an EPS beat based on the positive Earnings ESP and Zacks Rank, consider a tactical long position ahead of the September 3 report to potentially capitalize on a short-term price increase.
• Long-term investors should remain cautious, as an earnings beat would still occur against a backdrop of significant year-over-year declines in revenue and profitability, highlighting underlying fundamental weakness.
• Pay close attention to management's commentary and forward guidance on the earnings call, as this will be more critical for the stock's sustained performance than the earnings beat itself.
• Despite the strong indicators for a beat, the overall negative trend warrants prudent risk management; a miss on revenue or weak guidance could still lead to a negative stock reaction.