Macy's is investing $30 million in minority entrepreneurship and has joined fellow retailers like Sephora and Rent the Runway in the 15 Percent Pledge, which promises to devote 15% of its shelf space to Black-owned brands. The pledge's name reflects the fact that Black people make up about 15% of the country's population but are underrepresented on store shelves. Before this, Macy's already had an existing educational program called “Workshop,” which offered resources to minority owned brands on how to grow their business, and identified them as Macy's partners and suppliers. (Source: NYTtimes)
Representation matters… and pays. The classic American department store has delivered earnings beats for the last 4 consecutive quarters. Marketbeat consensus price target of $27.08 with +32% potential upside.
Cautiously optimistic as we enter the first COVID restriction free holiday season? Not sure if inflation-minded consumers will take on a pre or post-reformed Scrooge attitude towards spending.
Here's my options hedge, it's a multi-leg ratio strategy that can capture up to 13% upside, but also keep my capital safe against a 61% drop. If the stock rallies quickly, I can exit early and most likely collect higher rate of return.
Buy 2 $20 c, Sell 2 $22 c
Sell 4 $8 p
Exp 1/19/24
Capital Requirement: $3,187
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