Macy's stays a Buy with strong cash flow and turnaround signs, backed by Berkshire Hathaway's stake.

Macy's is rated a Buy due to its undervaluation, strong free cash flow yield, and positive turnaround indicators. The company projects Q2 revenue between $4.75B and $4.8B, an adjusted EBITDA margin of 6.9% to 7.2%, and adjusted EPS of 29 to 34 cents, excluding potential tariff refunds. Berkshire Hathaway's increased stake signals institutional confidence, while growth in the luxury segment and real estate monetization are key growth drivers. Risks include potential class action lawsuits related to tariffs, delays in real estate monetization, and downside risk if Q2 results only meet guidance.