Highlights from Zacks analyst blog: Macy’s and Amazon

0

For immediate release

Chicago, IL – November 8, 2021 – Zacks.com announces the list of stocks featured on the Analysts Blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. Recent actions featured in the blog include: Macy’s, Inc. M and Amazon.com, Inc. AMZN.

Here are highlights from Friday’s analyst blog:

Should Macy’s split up its e-commerce business?

A few weeks ago, The Wall Street Journal reported that luxury department store chain Saks Fifth Avenue (owned by Toronto-based Hudson’s Bay Co.) is aiming to go public with its e-commerce division at a valuation of $ 6 billion, which is impacting the industry of retail and prompts investors to consider whether Macy’s would do the same.

The new $ 6 billion valuation for Saks.com is triple the valuation the unit received following the investment from private equity firm Insight Partners earlier this year.

Many have rightly taken this as a sign that the online channels of other department stores, like Macys.com, could have similarly increased, especially after activist investor Jana Partners announced a stake in the department store chain last month; the company sent a letter to Macy’s board urging the retailer to separate its online and physical activities and saying its e-commerce segment is now worth more than Macy’s as a whole is today.

Considering these two catalysts, it’s no surprise that Macy’s shares climbed 17.5% on the day the WSJ report has been published. The Covid-19 pandemic has certainly changed the way we think about the retail industry, as it has highlighted which brands have the capacity to cope with unprecedented circumstances.

If Macy’s moved away from its e-commerce unit, it would be a major event for retail, reflecting how valuable online storefronts have become these days.

But that would not be an easy task.

Macy’s still has hundreds of stores open across the country (compared to just a few dozen for Saks), so separating physical and digital activities would present many logistical and operational challenges. Moreover, management has yet to indicate that it is even considering such a move.

Wall Street analysts also weighed in on the idea. Citibank analyst Paul Lejuez told clients he didn’t think a split made sense for Macy’s, maintaining a sell rating and a target price of $ 20 on the stock. On the flip side, Cowen analyst Oliver Chen argued that while a spin-off is unlikely to happen in the short term, Macy’s e-commerce unit could be worth more than $ 40. per share as an independent enterprise.

Investors, however, are clearly open to the idea. It’s also important to note that Jana Partners is used to approving mega-retail deals; they were part of the mob that pushed the organic grocer Whole Foods Market to be bought out by Amazon.

Macy’s stock has gained more than 174% year-to-date and its market capitalization now stands at nearly $ 9.6 billion. Stocks also remain a good deal, currently trading at a futures multiple of 8.2 times.

The company is expected to release its results on November 18, which will give us an up-to-date snapshot of its online business performance as the ultra-important holiday season approaches.

Media contact

Zacks investment research

800-767-3771 ext 9339

[email protected]

https://www.zacks.com

Past performance is no guarantee of future results. The potential for loss is inherent in any investment. This material is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether an investment is suitable for a particular investor. It should not be assumed that any investment in any identified and described securities, companies, sectors or markets was or will be profitable. All information is current as of the date hereof and is subject to change without notice. The views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or securities asset management activities. These returns come from hypothetical portfolios composed of stocks with a Zacks rank = 1 that have been rebalanced monthly without any transaction costs. These are not the returns of actual equity portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for more information on the performance numbers displayed in this press release.

Bitcoin, like the internet itself, could change everything

Blockchain and cryptocurrency have sparked one of the most exciting talking points in a generation. Some call it “the internet of money” and predict that it could change the way money works forever. If this is true, it could do to banks what Netflix did to Blockbuster and Amazon to Sears. Experts agree that we are in the early stages of this technology and as it develops it will create several investment opportunities.

Zacks just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and other cryptocurrencies with much less volatility than buying them directly.

See 3 Crypto Related Stocks Now >>

Click to get this free report

Amazon.com, Inc. (AMZN): Free Stock Analysis Report

Macy’s, Inc. (M): Free Stock Analysis Report

To read this article on Zacks.com, click here.

Zacks investment research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Share.

Leave A Reply