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Additional Reading from MarketBeat.com
What's Make of Macy's: Berkshire Hathaway's Latest BuyBy Leo Miller. Article Posted: 6/8/2026. 
Key Points
- Berkshire Hathaway made an unexpected move in Q1 2026 under new CEO Greg Abel, buying into Macy's stock.
- Macy's shares have taken a huge tumble since their peak 11 years ago, losing around half of their value.
- However, Macy's latest results show a company in recovery, with the firm posting a giant beat on adjusted earnings per share.
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In Q1 2026, investment management giant Berkshire Hathaway (NYSE: BRK.B) made a portfolio decision that few saw coming. According to its 13F SEC filing, Berkshire opened a new position in Macy’s (NYSE: M), one of the United States' most iconic department stores. While Macy’s has closed many locations since its peak in 2015, the company remains one of the biggest names in its industry. In fact, in 2024, Macy’s ranked as the world’s largest department store based on sales, with revenue of approximately $23.7 billion.
The Wall Street Journal is already raising the alarm about a potential market crash, and Weiss Ratings research points to the first half of 2026 as a particularly rough stretch for certain holdings.
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That fact would not be immediately obvious from the trajectory of Macy’s stock. Shares are down roughly 50% from their all-time high reached in 2015. Meanwhile, Macy’s market capitalization has fallen from nearly $25 billion to around $6 billion, wiping out about 75% of its value in 11 years. Given the massive shift toward e-commerce, Macy’s has become a stock that few investors would consider. However, Berkshire clearly sees something in this retail name, investing $55 million. Let’s break down where Macy’s has been and where it stands today to better understand why Berkshire sees value in the stock. Macy’s Fall From Grace: Stores, Revenue, and Margins SinkAs noted, Macy’s has seen a significant drop in its store count over the past decade or so. In 2016, Macy’s had more than 850 total stores. This included over 700 Macy’s-branded stores, more than 50 Bloomingdale’s locations, and over 70 Bluemercury stores. Today, the total store count has fallen to less than 675. The decline has been driven by a reduction in Macy’s-branded storefronts, with fewer than 450 physical locations remaining. Meanwhile, Bloomingdale’s and Bluemercury have actually expanded, with store counts of over 60 and 150, respectively. Last 12 months' revenue came in at $22.7 billion, down meaningfully from 2024 and about 19% below its calendar 2014 peak of $28.1 billion. Macy’s operating margin fell to a thin 2.3% in its latest quarter, well below the more than 6% it posted in the comparable quarter of 2014. Considering these metrics, it becomes much clearer why Macy’s market capitalization has fallen so sharply. However, over a shorter timeline, Macy’s has shown improvements in its business, as demonstrated by its recently released earnings report. Macy’s Posts Huge Adjusted EPS Beat, Raises GuidanceMacy’s reported its Q1 2026 earnings in early June, delivering solid results on several fronts. (Note that the company’s fiscal reporting period is slightly behind the calendar period.) The company posted revenue of $4.89 billion, an increase of 1.8% year over year (YOY) and well above estimates of $4.61 billion. Adjusted earnings per share (EPS) rose 18% YOY to 13 cents, far better than expected. Analysts had forecast adjusted EPS of just 2 cents, implying an 82% YOY decline. The company attributed the outperformance to sales growth that far exceeded expectations. Comparable sales, which eliminate the effect of store count changes, rose 3% YOY—its strongest growth since 2022. That compared with Macy’s comparable sales growth guidance of 0.5% to 1.5% and a decline of 2% from a year ago. Additionally, Macy’s achieved its sharp adjusted EPS beat despite a 4-cent tariff headwind. Macy’s also raised its full-year guidance. The company now expects midpoint comparable sales growth of 0.85%, compared with 0% previously. Its midpoint adjusted EPS guidance now stands at $2.10, up from $2. The updated adjusted EPS outlook implies a YOY decline of 9.5%. One of Macy’s key initiatives is to revamp its Macy’s-branded stores. That effort comes as luxury brands Bloomingdale’s and Bluemercury are growing much faster, with comparable sales rising 10.2% YOY and 6.4% YOY, respectively. Meanwhile, Macy’s-branded comparable sales grew just 1.6% YOY. To address that gap, the company is improving Macy’s stores through its “Reimagine” initiative. Reimagine improvements include changing the mix of merchandise and visual marketing within the stores. The 200 Macy’s locations that have already undergone Reimagine improvements showed better comparable sales growth of 2.4%, offering evidence that the strategy is starting to pay off. Macy’s: A Recovering Company With a Lot Left to ProveOverall, there are clear reasons Berkshire would find Macy’s attractive. While the company has struggled mightily over the past decade, its recent improvements are real. Still, it is worth noting that Berkshire is not making a big bet on the stock. At $55 million, the position represents just a tiny fraction of the firm’s overall equity portfolio of more than $250 billion. If Macy’s continues to make progress in its recovery, Berkshire could increase its stake over time. Notably, Wall Street analysts are not especially optimistic. The MarketBeat consensus price target of $20.30 implies around 10% downside in shares. The average of two targets updated after the firm’s report is $25, which suggests moderate upside. |
