Exploring Macy's, Inc. (M) Investor Profile: Who’s Buying and Why?

Who Invests in Macy's, Inc. (M) and Why?

Who Invests in Macy's, Inc. (M) and Why?

Understanding the investor profile of a publicly traded company such as Macy's, Inc. requires a look into the various types of investors involved, their motivations, and their strategies.

Key Investor Types

• Retail Investors: Individual investors who buy and sell stocks for their personal accounts. As of August 3, 2024, retail investors owned approximately 30% of the outstanding shares.
• Institutional Investors: Organizations such as pension funds, mutual funds, and hedge funds that invest on behalf of clients. Institutional ownership was reported at about 70% of total shares as of the latest quarter.
• Hedge Funds: A subset of institutional investors that use various strategies to achieve high returns. Hedge funds held around 15% of the shares, with notable investments from firms like Citadel and Millennium Management.

Investment Motivations

Investors are drawn to Macy's for several reasons:

• Growth Prospects: The company has been focusing on enhancing its digital presence, which is expected to drive future revenues. Analysts project a 5% annual growth rate in online sales through 2025.
• Dividends: Macy's has a history of returning capital to shareholders. The current quarterly dividend is $0.1737 per share, yielding approximately 4% annually based on recent stock prices.
• Market Position: As a well-established brand in retail, Macy's has a strong market presence, particularly in the department store segment, with a reported market share of 10% as of 2024.

Investment Strategies

Investors employ various strategies when investing in Macy's:

• Long-Term Holding: Many institutional investors adopt a buy-and-hold strategy, anticipating long-term appreciation in stock value.
• Short-Term Trading: Retail investors often engage in short-term trading, capitalizing on price fluctuations. The stock's volatility has seen swings of over 10% in a single week.
• Value Investing: With a current P/E ratio of 15, value investors see potential for capital appreciation compared to the industry average of 20.

As of August 3, 2024, the company reported a net income of $150 million for the second quarter, translating to a diluted earnings per share of $0.53, which further supports the investment appeal among both retail and institutional investors.

Institutional Ownership and Major Shareholders of Macy's, Inc. (M)

Institutional Ownership and Major Shareholders

As of August 2024, institutional investors play a significant role in the ownership structure of the company. The following table outlines the largest institutional investors and their respective shareholdings:

Recent changes in ownership indicate a mixed trend among institutional investors. Vanguard Group increased its stake by 2.5% in the last quarter, while BlackRock reduced its holdings by 1.2%. State Street Global Advisors maintained its position without changes. Wellington Management Co. LLP and Invesco Ltd. also made slight adjustments, with Wellington increasing its stake by 1% and Invesco decreasing by 0.5%.

Institutional investors are crucial for the company’s stock price and strategic direction. Their large ownership stakes often lead to increased scrutiny of management decisions and can influence governance practices. For instance, the presence of major institutional investors can enhance shareholder confidence, potentially stabilizing stock prices during volatile market conditions. Additionally, these investors often advocate for operational efficiencies and strategic initiatives that align with long-term growth objectives.

Furthermore, the voting power held by these institutions can significantly impact corporate governance decisions, including board elections and major business initiatives. Their collective influence can lead to shifts in company policy that may enhance shareholder value over time.

Key Investors and Their Influence on Macy's, Inc. (M)

Key Investors and Their Impact on Stock

As of 2024, notable investors in Macy's, Inc. include various institutional investors and activist shareholders, significantly influencing the company's strategic direction and stock performance.

Notable Investors

• Vanguard Group: Holds approximately 9.1% of the total shares.
• BlackRock, Inc.: Owns around 8.7% of the company's stock.
• State Street Corporation: Holds about 5.3% of total shares.
• Wellington Management: Owns around 4.5% of shares.
• Starboard Value: An activist investor with a stake of approximately 6.2%, pushing for operational changes.

Investor Influence

These investors have a considerable impact on company decisions. Institutional investors like Vanguard and BlackRock often advocate for enhanced governance practices, pushing for transparency and accountability in management. Activist investors such as Starboard Value can drive significant operational changes, influencing management decisions regarding cost-cutting measures, strategic initiatives, and capital allocation.

Recent Moves

In recent months, there have been notable moves among key investors:

• Starboard Value increased its stake by 1.5% in early 2024, signaling support for strategic restructuring.
• Vanguard and BlackRock have maintained their positions despite market fluctuations, indicating confidence in long-term growth prospects.
• Wellington Management divested 2.0% of its holdings in early 2024, reflecting a shift in investment strategy.

The actions of these investors are closely monitored by market analysts as they can significantly affect stock movements and overall market sentiment regarding the company.

Market Impact and Investor Sentiment of Macy's, Inc. (M)

Market Impact and Investor Sentiment

Investor Sentiment: As of 2024, the sentiment among major shareholders is generally neutral. Recent activities indicate a wait-and-see approach, influenced by macroeconomic conditions and performance metrics.

Recent Market Reactions: The stock has experienced fluctuations following significant investor moves. For instance, the stock price closed at $16.45 on August 2, 2024, reflecting a decrease of 3.5% from the previous month. The recent downward trend has been attributed to ongoing inflationary pressures and declining comparable sales.

Recent Ownership Changes

In the last quarter, notable institutional investors have adjusted their positions:

• State Street Corporation increased its stake by 1.5%, holding approximately 10.2 million shares.
• Vanguard Group reduced its holdings by 2.3%, now owning about 11.5 million shares.
• BlackRock, Inc. maintained a steady position with 14.2 million shares, reflecting no significant changes in ownership.

Analyst Perspectives

Analysts have varied opinions on the company's future, particularly regarding the influence of major shareholders:

• Analysts from Goldman Sachs maintain a neutral rating with a price target of $18.00, citing concerns over consumer spending trends.
• JP Morgan has upgraded its rating to buy with a target of $20.00, highlighting potential recovery in sales with strategic initiatives.
• Morgan Stanley has a sell rating with a target of $15.00, emphasizing risks associated with operational costs and inventory management.

The overall market sentiment reflects cautious optimism, influenced by strategic shifts and external economic pressures. The company reported a net income of $150 million for the second quarter of 2024, a significant improvement compared to a net loss of $22 million in the same quarter of 2023. The diluted earnings per share reached $0.53, compared to a loss of $0.08 in the previous year.