Macy’s Inc. shares have left the S&P 500 in the dust in 2021, gaining 227.6 percent year-to-date. Macy’s stock has had a wild ride in recent years, but investors may be wondering whether there’s any value in Macy’s shares after the big gains. Earnings A price-to-earnings ratio (PE) is one of the most basic fundamental metrics for gauging a stock’s value. The lower the PE, the higher the value. For comparison, the S&P 500’s PE is currently at about 29.4, nearly double its long-term average of 15.9. Macy’s PE is 18.9, about 35 percent lower than the S&P 500 average as a whole. Growth Looking ahead to the next four quarters, the S&P 500’s forward PE ratio looks much more reasonable at just 21.4. Macy’s forward earnings multiple of 9.1 is less than half the S&P 500’s, making Macy’s look extremely undervalued. Macy’s forward PE ratio is also less than …
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