Macy'sM

Morningstar Rating

Stock Research and Analysis

by Kimberly Picciola

We think the back half of 2009 will be difficult for Macy's as consumers continue to curb spending on discretionary goods. Additionally, the department store chain has a more leveraged balance sheet than a number of its close competitors, limiting its Read more

Bulls Say

Through its My Macy's initiative, the department store chain is focused on offering a merchandise assortment and shopping experience that meets the needs of its customers on a more localized basis.

Macy's is centralizing various back-office functions, such as buying, planning, and marketing, that were previously housed within each of the company's four regions.

Macy's continues to increase penetration of its private- and exclusive-label brands.

Macy's is working to improve its speed to market to ensure current trends are reflected in its merchandise.

Macy's operates some of the most recognizable department stores in the U.S. with its Bloomingdale's and Macy's nameplates. Read more

Bears Say

Consumers face a number of head winds from a weak housing market, tight credit markets, and a challenging employment environment. This has made them more cautious with their discretionary spending in recent months.

Competitors like J.C. Penney and Kohl's KSS are enhancing the quality of their merchandise offering, putting them in more direct competition with Macy's.

The Macy's nameplate has struggled in some former May markets.

With debt levels high, Macy's has less financial flexibility than a number of its close competitors.

The company's aggressive efforts to enhance its merchandise offering might be futile if customers continue to opt for off-mall and discount-oriented retailers. Read more

Strategy

Macy's is focused on localizing its merchandise assortment and shopping environment through the national rollout of its My Macy's initiative. As part of the effort, Macy's is grouping its nameplate stores Read more

Management

Terry Lundgren is CEO and chairman of Macy's. He has served as CEO for the last five years and has spent more than 25 years with the company in two separate stints. He has been COO and chief merchandising officer, so he has plenty of experience running Read more

Profile

Macy's operates around 800 Macy's stores and 40 Bloomingdale's stores in the United States and Puerto Rico. Its stores are primarily located in malls and sell family apparel, Read more

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