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Strength Seen in Macy's (M): Can Its 9.9% Jump Turn into More Strength?

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Macy's M shares rallied 9.9% in the last trading session to close at $20.96. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 16.8% loss over the past four weeks.

Macy’s has been benefitting from successful execution of Polaris strategy, robust omni-channel capabilities, curated merchandise assortment and accelerated rate of customer acquisition. Macy's digital business remain one of the major revenue drivers. The company has been undertaking a host of initiatives to provide customers a seamless shopping experience.

This department store operator is expected to post quarterly earnings of $0.89 per share in its upcoming report, which represents a year-over-year change of -31%. Revenues are expected to be $5.53 billion, down 2.2% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Macy's, the consensus EPS estimate for the quarter has been revised 11.1% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on M going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Macy's is part of the Zacks Retail - Regional Department Stores industry. Dillard's DDS, another stock in the same industry, closed the last trading session 6.6% higher at $259.85. DDS has returned -14.6% in the past month.

For Dillard's , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at $3.20. This represents a change of -63.7% from what the company reported a year ago. Dillard's currently has a Zacks Rank of #1 (Strong Buy).

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