Is It Time to Bet on This Department Store Stock's Breakout?

The stock already sports a 44% year-over-year lead

Digital Content Manager
Mar 10, 2022 at 2:27 PM
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The shares of department store concern Macy's Inc (NYSE:M) didn't see the same dramatic dip many stocks suffered during the past couple weeks, though the security has been middling between the $22 and $28 levels since a sharp pullback from its three-year peak in late November. Though the stock was jostled into the lower portion of this channel earlier in the week, the pullback put M back near a historically bullish trendline that could provide tailwinds in the coming month. 

To be more specific, Macy's stock just came within one standard deviation of its 200-day moving average after a lengthy period spent above the trendline. According to data from Schaeffer's Senior Quantiative Analyst Rocky White, M has seen two similar signals during the past three years, logging positive one-month returns after both signals and averaging a 6.5% pop in this time period. From its current perch, a similar move would put the equity at $26.07 and closer to a breakout on the charts.

M march 10

Despite its 44% year-over-year lead, analysts are still hesistant, which could lead to bull notes down the road. Of the nine in coverage, only three consider M a "strong buy," while four say "hold," and two say "sell" or worse. 

An unwinding of short interest could also propel Macy's stock higher. In the last two reporting periods, short interest rose 7.9%, and now makes up a heavy 11.1% of the stock's available float.

 

 

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