Ratios And Financial Analysis Of Macy's

As seen from the image above, Macy’s current stock price as at 23rd May is $33.48 per share. Based on the calculations above in 3.0, Macy’s predicted future stock price using the P/E ratio valuation method will be $58.58, a 74.97% increase in stock value. As for P/S ratio analysis, Macy’s stock price is predicted to increase by 34.71% to $45.10.

Those figures can be backed by some of the steps Macy’s has taken recently to boost their sales and help the economy grow. Macy’s recently expanded its customer loyalty program, Star Rewards, to include all customers regardless how they pay for purchases which were previously exclusive for Macy’s cardholders (Caproni, 2018). The rewards program not only benefits all other customers, existing Macy’s cardholders will also receive additional

Also, with the individual tax cuts, this will induce customers to spend more and at the same time be rewarded for their spending. Hence sales is forecasted to rise further over the next 12 months and as consumer spending increases, this will increase GDP. Furthermore, Macy’s competitors Abercrombie & Fitch, Banana Republic, J.C.Penny and more are closing stores due to declining sales (Ramer, 2018). Macy’s on the other hand, is expanding their business with plans to open another 100 stores this year and one distribution centre in Columbus, Ohio which will not only boost sales, but also create more jobs which is in line with the forecast of unemployment rate decreasing. The opening of the new distribution centre is to increase efficiency in transporting merchandise with more flexibility to stores within the region and surrounding states which will reduce transportation costs in the long run, thus increasing net income which will increase earnings per share (Driscoll,