Macy's sells a range of merchandise, including apparel and accessories for men, women, and children; cosmetics; home furnishings; and other consumer goods through its department stores and direct-to-consumer. The company was founded in 1830 and is based in Cincinnati, Ohio.
M Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Macy's Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Macy's Inc ranked in the 67th percentile in terms of potential gain offered. Moreover, under all the scenarios we modelled, the output consistently forecasted positive returns. The most interesting components of our discounted cash flow analysis for Macy's Inc ended up being:
Its compound free cash flow growth rate, as measured over the past 5.56 years, is -0.17% -- higher than just 12.04% of stocks in our DCF forecasting set.
16% of the company's capital comes from equity, which is greater than just 9.72% of stocks in our cash flow based forecasting set.
The weighted average cost of capital for the company is 5. This value is greater than only 2.36% stocks in the Consumer Cyclical sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Consumer Cyclical that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as M, try SGMS, ALSN, LCUT, LEG, and LDL.