Macy's, Inc. (M) DCF Valuation
TGM's two-stage DCF values Macy's, Inc. (M) between $17.58 and $30.64 depending on assumptions, with a base case of $23.13. Growth is taken from the company's own record (blend of 5-year revenue and FCF growth), fading to 2.5% long-run; the discount rate (11.5%) reflects its beta.
What would today's price require?
$24.66 is justified only if free cash flow grows about +8.1% a year (fading to 2.5% long-run) at a 11.5% required return — slower than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 3.8%/yr | 12.5% | $17.58 |
| Base case | 6.8%/yr | 11.5% | $23.13 |
| Optimistic | 9.8%/yr | 10.5% | $30.64 |
| Analyst DCF (FMP) | independent reference — different model | $26.74 | |
Current Price
$24.66
Market-Implied Growth
+8.1%/yr
vs +10.7% 5Y actual
Model Scenario Range
$17.58 – $30.64
model output — not a price target
M DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for M (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $540.0M · 0.26B shares · net debt $1.2B
Estimated Fair Value
$27.01
+9.5% vs $24.66
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 6.8%/yr FCF growth and 10-year horizon fixed. Green = above today's $24.66; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 9.5% | $33.72 | $35.18 | $36.85 | $38.78 | $41.02 |
| 10.5% | $29.07 | $30.12 | $31.31 | $32.65 | $34.19 |
| 11.5% | $25.36 | $26.14 | $27.01 | $27.99 | $29.08 |
| 12.5% | $22.35 | $22.94 | $23.60 | $24.32 | $25.12 |
| 13.5% | $19.86 | $20.32 | $20.82 | $21.37 | $21.97 |
About Macy's, Inc.
Macy's, Inc. is a prominent retail enterprise that employs an omnichannel strategy, serving customers through its extensive network of physical department stores, dedicated e-commerce websites, and convenient mobile applications. The company offers a broad assortment of merchandise, including apparel and accessories for men, women, and children, cosmetics, home furnishings, and other general consumer goods. As of January 29, 2022, Macy's operated 725 department stores domestically in locations such as the District of Columbia, Puerto Rico, and Guam. These stores are branded under several well-known names like Macy's, Macy's Backstage, Market by Macy's, Bloomingdale's, Bloomingdale's The Outlet, Bloomies, and the beauty retailer bluemercury. Internationally, Macy's also extends its reach through licensing agreements, with operations in Dubai, United Arab Emirates, and Al Zahra, Kuwait. The company maintains a presence in the beauty and spa retail sector. Originally established in 1830, the company was previously known as Federated Department Stores, Inc. It officially changed its name to Macy's, Inc. in June 2007, and its corporate headquarters are located in New York, New York.
- Sector
- Consumer Cyclical
- Industry
- Department Stores
- CEO
- Antony Spring