Dillard's vs Macy's Which Is a Smarter Choice?

Dillard's and Macy's are two major players in the retail industry, each with a long history of serving customers across the United States. Both companies have experienced fluctuations in their stock prices over the years, driven by factors such as consumer spending trends, economic conditions, and competition from online retailers. Investors considering Dillard's vs Macy's stocks may need to carefully evaluate factors such as financial performance, growth potential, and overall industry trends to make informed decisions about their investment portfolios.

Dillard's or Macy's?

When comparing Dillard's and Macy's, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Dillard's and Macy's.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Dillard's has a dividend yield of 6.13%, while Macy's has a dividend yield of 4.2%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Dillard's reports a 5-year dividend growth of 120.61% year and a payout ratio of 54.12%. On the other hand, Macy's reports a 5-year dividend growth of -15.21% year and a payout ratio of 112.43%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Dillard's P/E ratio at 10.84 and Macy's's P/E ratio at 27.28. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Dillard's P/B ratio is 3.48 while Macy's's P/B ratio is 0.27.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Dillard's has seen a 5-year revenue growth of 0.75%, while Macy's's is 0.04%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Dillard's's ROE at 33.65% and Macy's's ROE at 2.26%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $415.44 for Dillard's and $16.18 for Macy's. Over the past year, Dillard's's prices ranged from $328.00 to $476.48, with a yearly change of 45.27%. Macy's's prices fluctuated between $14.06 and $22.10, with a yearly change of 57.18%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.