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Macy's (M) reports first quarter results before Wednesday's opening bell. Coresight Research CEO and founder Deborah Weinswig joins Morning Brief to discuss what investors can expect from the company's earnings print.
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Let's talk about Macy's for a moment. Uh I'm looking at the stock which is down about 40% over the past year. Um what needs to go right for Macy's? What do we need to hear from them?
I mean, number one is traffic, right? You you've got to see the traffic. Uh number two, I would say is is conversions. So once the consumers in there, are they finding their size? Are they finding their color? Are they getting assistance? So so conversion. And then number three, I I think it goes back, you know, I some of the really interesting conversations with with leadership there is that ultimately the product is probably about the same price as you would get at an off-price retailer like a TJ Maxx or Ross stores or Burlington Coat Factory, but the issue is it's a it's a coupon, it's a credit card. The the pricing tends to be a bit less transparent for the consumer. And so I I do think that that does hurt them in the near and long term unless they can figure that out.
Is this a long-term activist target? We were talking about this during the break, trying to figure out and and recall exactly where Macy's really stood within some of those historical battles that it's had to navigate through.
I mean, you've you've seen right the the department stores have definitely been a target. And I think it goes back to at a high level, when you think about some of the things that could be fixed, you have, I would say broken damaged relationships between the the vendors and the retailer, that that's something that, you know, is an opportunity. Secondly, on the positive side, private label has done very well for Macy's. So I do think you have this hidden gem and, you know, going back to how do you kind of market that? How do you target that to new consumers? And then number three is just, you know, they're they're spending so much whether it's, you know, kind of CAPEX or OPEX on, as you alluded to, digital transformation, but are they spending in the right places? And then also how are they communicating that to Wall Street? That is I think that's been a challenge for a long time and I haven't really seen that improve. I think that's that's their cryptonite if you will.