Macys Inc. (formerly Federated Department Stores) (M)

(A Top Pick June 1/16. Up 10.12%.) He sold it when it hit $40. It is not something he thinks would continue to rise. In the low $30, he still likes it and would have no problem with it.

They delivered earnings to the down side more than others at the beginning of the year. Retailers have problems with ecommerce.

Wouldn’t invest in this for the long-term, because the headwind of Department stores or brick-and-mortar type retailers is severe. People are getting involved with the ease of online shopping and its cost effectiveness.

This is bottom fishing. It has had a nice pullback. His model price is $42, a 27% upside. Dividend yield of 4.46%.

The sector is under pressure and the stock has collapsed. He likes to find things that are under pressure. If this was the only company that looked like this, he wouldn’t have picked it, but a lot of retailers look like this. It stopped at $30 and has already rallied up 10%. Thinks it has a very, very good chance of getting back up to $40.

Have both Macy’s and Bloomingdale brands. Extremely well-managed. They are executing very well within store, e-commerce and their marketing initiatives. Revenues are 100% from the domestic US market. The improving US labour market and lower energy costs means more money for consumers to spend. 13X forward earnings with 10% long-term EPS growth.

Like this as well as Walmart, however it is more volatile, so it needs to be watched closer. Take profits when it's up.