The J.P. Morgan analyst switched his recommendation on the stock to "overweight" from "neutral" Friday and pinned part of the change on an improvement in Manhattan's shopping backdrop.
He noted the higher-end Bloomingdale's division, which has two outposts in the city, has outperformed the rest of the company and the Macy's Herald Square flagship is showing signs of life.
"Looking ahead...with the U.S. dollar weakening, stock market stabilizing and white-collar employment poised to improve, it's likely the rebound on both fronts could continue," Grom said.
A shopping comeback of any sort would help not only Macy's, but Saks Inc., and the thousands of other stores vying for New York's consumer dollar. But some serious challenges remain, especially the continued weakness on the job front, underlined by the rise in national unemployment to 10.2 percent.