Looking for a Cheap Retailer to Buy on the Upswing? Here's an Idea
Few industries were as devastated by the pandemic as major retailers, particularly those who rely on in-store experiences. The "big box" retailers were among those hit hard: think Macy's, JC Penney's, Nordstrom, and Kohl's.
But as the pandemic risk slowly but surely fades, many of these battered down retailers may present opportunities for investors to buy on the upswing. And compared to Nordstrom and Kohl's (see analysis below), Macy's is looking undervalued.
Macy's posted a better-than-expected holiday shopping season. Net sales declined -18.7%, but that was better than the -22.6% decline analysts expected. Anytime a company's actual earnings are better than expected, it is usually good news for the stock price.
Net income was also a positive surprise. Macy's earned $160 million in Q4, which widely surpassed the $14.3 million expected by the street. Macy's took big steps to cut costs and said in a statement that it will continue to keep costs at a minimum going forward. Another hint of good news: Macy's reported that the holiday shopping season brought in 7 million new customers, and many of them were younger than the existing customer base. That's good news for the future, particularly if Macy's can continue reinventing its business model to cater to online shoppers.
At the end of the day, Macy's still incurred a full-year loss of $3.9 billion, and retailers in that category face an challenging future. But compared to Kohl's and Nordstrom, Macy's is trading at roughly half the multiple -- meaning investors may have a short-term opportunity to capture a bit of upside on the economic rebound. Below, Tickeron's A.I.dvisor takes a closer look at Macy's, Kohl's, and Nordstrom, with investment insights and detailed fundamental analysis.
M sees its Stochastic Oscillator ascending out of oversold territory
On June 27, 2025, the Stochastic Oscillator for M moved out of oversold territory and this could be a bullish sign for the stock. Traders may want to buy the stock or buy call options. Tickeron's A.I.dvisor looked at 56 instances where the indicator left the oversold zone. In of the 56 cases the stock moved higher in the following days. This puts the odds of a move higher at over .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on June 30, 2025. You may want to consider a long position or call options on M as a result. In of 91 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for M just turned positive on June 30, 2025. Looking at past instances where M's MACD turned positive, the stock continued to rise in of 55 cases over the following month. The odds of a continued upward trend are .
M moved above its 50-day moving average on June 30, 2025 date and that indicates a change from a downward trend to an upward trend.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where M advanced for three days, in of 290 cases, the price rose further within the following month. The odds of a continued upward trend are .
M may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Bearish Trend Analysis
The 10-day moving average for M crossed bearishly below the 50-day moving average on June 24, 2025. This indicates that the trend has shifted lower and could be considered a sell signal. In of 18 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where M declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for M entered a downward trend on June 11, 2025. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.711) is normal, around the industry mean (2.414). P/E Ratio (5.889) is within average values for comparable stocks, (30.957). Projected Growth (PEG Ratio) (1.212) is also within normal values, averaging (0.905). Dividend Yield (0.061) settles around the average of (0.037) among similar stocks. P/S Ratio (0.144) is also within normal values, averaging (0.614).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. M’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 72, placing this stock worse than average.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating slightly worse than average price growth. M’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
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Fundamental Analysis Ratings
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General Information
an operator of department stores
Industry DepartmentStores
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