Macy's Stock Faces Sharp Selloff Amid Market Headwinds: Key Insights for Investors

Macy’s (M) ended the trading session at $19.15, down 4.2% from the previous close—a notably steeper decline than the broader market indices. While the S&P 500 dropped 0.92%, the Dow fell 1.18%, and the tech-heavy Nasdaq slipped 0.84%, the department store chain’s slide underscored sector-specific weakness. Despite this recent pullback, the stock has managed a 12.18% monthly gain, substantially outpacing the Retail-Wholesale sector’s modest 0.48% advance and the S&P 500’s 1.48% climb.

Earnings Report on the Horizon: What to Expect

Investors are keeping their eyes firmly on Macy’s upcoming earnings release scheduled for December 3, 2025. The company faces considerable headwinds based on consensus projections. For the upcoming quarter, analysts expect earnings per share of -$0.14, representing a dramatic 450% decline year-over-year. Quarterly revenue is forecasted at $4.59 billion, marking a 3.25% contraction compared to the same period last year.

Looking at the full-year picture, the consensus estimates suggest earnings of $2 per share against revenue of $21.37 billion. These figures translate to year-over-year declines of 24.24% and 4.13%, respectively—painting a challenging profitability landscape for the retail operator.

Valuation and Industry Standing

From a valuation standpoint, Macy’s appears attractive relative to its peers. The stock trades at a Forward P/E of 10.02, significantly below the industry average of 20.53. This discount suggests the market may be pricing in elevated risk or underestimating recovery potential.

The broader Retail-Regional Department Stores industry occupies an interesting position within the Retail-Wholesale sector, ranking 25th among over 250 industries. This mid-tier placement indicates moderate competitive positioning, with the top-performing industries historically outperforming laggards by a 2-to-1 margin.

The Bigger Picture

Macy’s recent performance reflects the complex dynamics facing traditional retail. While the monthly outperformance against sector benchmarks is encouraging, the company’s earnings trajectory raises questions about operational efficiency and consumer demand. The substantial valuation discount presents both opportunity and caution—value hunters may see potential, while momentum traders may view the negative earnings guidance as a red flag.

The December earnings report will be critical in determining whether current market sentiment reflects fair value or represents an overreaction to temporary headwinds.