Key Takeaways
- Berkshire Hathaway revealed a fresh investment in Macy’s valued at approximately $55 million, representing between 3 million and 4 million shares as of the end of Q1.
- Following the disclosure through Berkshire’s 13F quarterly report, Macy’s stock experienced an after-hours surge of approximately 5-6%.
- Under new leadership from CEO Greg Abel, Berkshire increased its Delta Air Lines holdings by nearly 40 million shares while completely divesting from Amazon, Visa, Mastercard, and UnitedHealth.
- The department store chain is executing a strategic pivot, shuttering underperforming locations while channeling resources into high-performing stores, Bloomingdale’s, and Bluemercury.
- Management projects declining net sales for fiscal 2026 and has identified tariff headwinds as a significant challenge, with maximum impact anticipated during the first quarter.
The investment community took notice when Berkshire Hathaway’s most recent 13F disclosure, reflecting holdings through March 31, unveiled an approximately $55 million investment in Macy’s. The revelation triggered a 5.9% uptick in Macy’s stock during Friday’s after-hours session.
According to the regulatory filing, Berkshire’s position encompasses roughly 3 to 4 million Macy’s shares. While modest compared to Berkshire’s massive investment portfolio, any connection to Warren Buffett’s legacy company generates significant market interest.
This marks Berkshire’s first notable Macy’s investment under the leadership of Greg Abel, who assumed the CEO role this past January following Buffett’s transition from the position.
Additional Portfolio Adjustments at Berkshire
Berkshire simultaneously boosted its Delta Air Lines stake by approximately 40 million shares, triggering a 3% after-hours increase for the airline. The conglomerate also expanded its Alphabet holdings while preserving its flagship investments in Apple, American Express, Coca-Cola, and Moody’s.
Regarding divestitures, Berkshire completely liquidated positions in Amazon, Visa, Mastercard, UnitedHealth, Aon, and Domino’s Pizza. UnitedHealth shares declined 2.4% in extended trading following the disclosure. These exited investments may have been overseen by Todd Combs, who departed Berkshire for JPMorgan Chase this April.
A critical caveat: 13F reports reflect historical data. Since these figures represent March 31 holdings, Berkshire’s present-day portfolio composition may differ substantially.
Transformation Efforts at Macy’s Continue
Macy’s is currently executing a comprehensive restructuring initiative. The strategy involves shuttering weak-performing stores while reallocating capital toward locations experiencing stronger foot traffic. CEO Tony Spring has emphasized incorporating more contemporary brands and expanding workforce investment.
Bloomingdale’s delivered impressive holiday quarter performance, recording comparable sales growth of 9.9%. Bluemercury similarly reported encouraging outcomes. Macy’s consolidated fourth-quarter net sales reached $7.6 billion, accompanied by comparable sales growth of 1.8%.
However, challenges persist on the horizon. Management’s fiscal 2026 guidance calls for net sales between $21.4 billion and $21.65 billion, representing a decline from the $21.8 billion projected for fiscal 2025. Adjusted earnings per share guidance spans $1.90 to $2.10.
Tariff pressures present a legitimate concern. Since Macy’s procures the majority of its apparel, home products, and accessories internationally, the company anticipates substantial tariff-related headwinds during the year’s first half, especially throughout Q1.
Management maintained its quarterly dividend at 19.15 cents per share, with distribution scheduled for July 1 to shareholders recorded as of June 15.
Competitor Kohl’s indicated in March that annual sales might remain flat or contract by up to 2%, with CEO Michael Bender attributing the outlook to conservative spending patterns among lower and middle-income consumers. Macy’s confronts comparable challenges at its flagship brand, though Bloomingdale’s continues attracting more affluent clientele.
Macy’s concluded the week favorably, with the Berkshire disclosure fueling after-hours momentum. The critical assessment arrives at the next earnings report, where stakeholders will evaluate whether store enhancements and the emphasis on Bloomingdale’s and Bluemercury translate into tangible sales performance.
