Macy's stock rises as Berkshire Hathaway invests amid store closures
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 19 2024
0mins
Source: Investing.com
Macy's Inc. shares increased by 5.37% as the stock reached a 20-day high, reflecting positive investor sentiment.
The rise in Macy's stock is attributed to Berkshire Hathaway's recent investment strategy, where CEO Greg Abel added positions in Macy's, indicating confidence in the company's potential despite its announcement to close 150 stores between 2024 and 2026 due to operational challenges. This strategic move by Berkshire, coupled with Macy's reported 1.8% year-over-year increase in comparable sales for Q4 2025, suggests that the company's transformation strategy is gaining traction, attracting more investor interest.
The implications of this investment highlight a potential turnaround for Macy's, as it navigates through challenges in the retail sector. The market's positive reaction to Berkshire's investment strategy may signal a renewed confidence in Macy's ability to adapt and grow in a changing retail landscape.
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Analyst Views on M
Wall Street analysts forecast M stock price to fall
12 Analyst Rating
2 Buy
9 Hold
1 Sell
Hold
Current: 22.450
Low
8.00
Averages
21.33
High
27.00
Current: 22.450
Low
8.00
Averages
21.33
High
27.00
About M
Macy's, Inc. is an omni-channel retail company. The Company operates stores, websites and mobile applications under three brands, Macy's, Bloomingdale's and Bluemercury, which sell a range of merchandise, including apparel and accessories (men's, women's and kids'), cosmetics, home furnishings and other consumer goods. The Company has stores in 43 states, the District of Columbia, Puerto Rico and Guam. Its operations are conducted through Macy's, Macy's Backstage, Macy's small format, Bloomingdale's, Bloomingdale's The Outlet, Bloomie's, and Bluemercury. In addition, Bloomingdale's in Dubai, United Arab Emirates and Al Zahra, Kuwait are operated under a license agreement with Al Tayer Insignia. The principal private label brands offered by the Company include Alfani, And Now This, Aqua, Bar III, Cerulean 6, Charter Club, Club Room, Epic Threads, first impressions, Giani Bernini, Holiday Lane, Home Design, Hotel Collection, Hudson Park, Ideology, I-N-C, jenni, JM Collection, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Decisive Exit from Losers: Berkshire sold off underperforming stocks like Pool Corp. and Domino's Pizza in Q1, which may have locked in losses, but Abel believes that timely exits are necessary to prevent dragging down overall investment performance amid uncertainty.
- Investment in Special Situations: Abel initiated new stakes in Delta Air Lines and Macy's during Q1, both facing systemic challenges, indicating a strategic willingness to invest in potentially undervalued companies that could yield returns in the future despite current difficulties.
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- Increased Cash Reserves: As of the end of March, Berkshire Hathaway's cash reserves reached a record $397 billion, reflecting the company's strategy to wait for more attractive investment opportunities in an overvalued stock market.
- New Investment Direction: Abel initiated new stakes in Delta Air Lines and Macy's during Q1, signaling a willingness to take on higher risks for potential returns despite the systemic challenges these companies face, which may alter the company's investment style.
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- Small Position Cleanup: In Q1, Abel eliminated 16 small positions, including Visa and Amazon, none of which accounted for more than 1% of Berkshire's total portfolio, aiming to enhance focus and efficiency in the investment strategy to improve long-term performance.
- Decisive Exit from Losers: Berkshire sold off underperforming stocks like Pool Corp. and Domino's Pizza in Q1, which may have locked in losses, but Abel believes that timely exits are necessary to prevent dragging down overall investment performance amid uncertainty.
- Investment in Special Situations: Abel initiated new stakes in Delta Air Lines and Macy's during Q1, both facing systemic challenges, indicating a strategic willingness to invest in potentially undervalued companies that could yield returns in the future despite current difficulties.
- Increased Cash Reserves: As of the end of March, Berkshire's cash reserves reached $397 billion, suggesting that Abel may be waiting for more attractive investment opportunities while potentially shifting towards wholly-owned cash-generating businesses to reduce reliance on volatile stocks.
See More
Greg Abel's Strategic Shift at Berkshire Hathaway
- Portfolio Adjustment: New CEO Greg Abel reduced investments in long-held positions like Visa and Mastercard in Q1, indicating a shift away from smaller stakes, which may enhance the overall quality and return potential of the portfolio.
- Increased Cash Reserves: As of the end of March, Berkshire Hathaway's cash reserves reached a record $397 billion, reflecting the company's strategy to wait for more attractive investment opportunities in an overvalued stock market.
- New Investment Direction: Abel initiated new stakes in Delta Air Lines and Macy's during Q1, signaling a willingness to take on higher risks for potential returns despite the systemic challenges these companies face, which may alter the company's investment style.
- Long-Term Strategic Thinking: Abel's decisions suggest that Berkshire may gradually reduce reliance on volatile stocks and shift towards more controllable cash-generating businesses, potentially providing shareholders with more stable returns.
See More
Retail Chains Close Hundreds of Stores Amid Pandemic Shift
- Store Closures: Saks Global Enterprises filed for Chapter 11 bankruptcy in January 2026, resulting in dozens of store closures, highlighting the fragility of the retail sector and a sharp decline in market demand since the pandemic.
- Macy's Closure Plan: Macy's announced it would close 150 stores between 2024 and 2026, reflecting operational challenges under high inflation and rising lease rates, which may further weaken its market share.
- Mysterious Closures of Small Chains: Dark Horse Comics will close its retail chain Things From Another World by September 30, 2026, without providing specific reasons, potentially impacting brand loyalty and its consumer base.
- E-commerce Shutdown: The e-commerce site for Things From Another World closed on April 30, 2025, eliminating online sales options for customers, which may lead to a decline in sales revenue and limit consumer purchasing choices.
See More
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- Portfolio Adjustments: In his first quarterly report, Abel adjusted the $330 billion equity portfolio by adding positions in Delta Airlines and Macy's, while tripling the stake in Alphabet, indicating his proactive approach to high-conviction stocks while maintaining Buffett's investment style.
- Small Position Sell-Off: In the first quarter, Abel and his team sold out of 16 smaller positions, including Visa and Mastercard, which accounted for about a third of Berkshire's total holdings, demonstrating decisive action in optimizing the investment portfolio.
- Core Holdings Retained: Despite the significant sell-off, Abel retained core holdings such as Apple, American Express, and Coca-Cola, reflecting his respect for and continuation of the company's traditional investment strategies established by Buffett.
- Positive Market Reaction: Following the announcement of Abel's investment strategy, Berkshire Hathaway's stock ticked higher, reflecting market confidence in his management capabilities and further solidifying the company's position in the investment community.
See More
Berkshire Hathaway's Abel Restructures Equity Portfolio
- Portfolio Restructuring: Greg Abel cut 16 small positions in the first quarter, including long-held Visa and Mastercard, demonstrating a strategic focus on concentrated high-conviction stocks while maintaining Buffett's traditional investment style.
- New Investment Directions: Abel added positions in Delta Airlines and Macy's, and tripled the investment in Alphabet, indicating a strategy aligned with Buffett's tech stock preferences, which may attract younger investors.
- Increased Concentration: Excluding investments in Japan, Berkshire now holds only 29 positions, retaining Buffett favorites like Apple, American Express, and Coca-Cola, reflecting ongoing confidence in classic quality assets.
- Positive Market Reaction: Despite the reduction of about one-third of the portfolio, Berkshire's stock price rose following the announcement, indicating market approval of Abel's investment strategy and suggesting optimistic expectations for future performance.
See More
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- Tron Investment Risks: With a 25% increase this year, Tron faces competitive pressure due to its offshore ties with Tether, suggesting investors should sell to avoid potential losses as the Digital Asset Market Clarity Act progresses.
- MemeCore Exit Strategy: MemeCore has doubled this year to $2.88 with a market cap of $3.8 billion, and given the cautious market sentiment towards high-risk investments, locking in gains before summer is advisable.
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