Its recent earnings was bad, but it’s not all bad news.

Macy’s might be the best house in a burning neighborhood.

But don’t invest for the dividend yield and don’t invest for a turnaround.

Macy’s (NYSE:M) has had a horrible few years. This is actually the ninth straight quarter that the retail giant has posted declining revenues. And it certainly isn’t helped by the fact that it is part of a sector that has seen extensive carnage over the last several years. Macy’s has gone from $70 a share to nearly $20 a share in just a couple years.

The big overhang is that there are multiple sources for Macy’s woes, and how the company deals with them individually will determine whether it can make a comeback – or whether it will survive at all. Fortunately, the chain is actually in better shape than other retailers, in a couple of very important ways.

Current Status

In the most recent quarterly report, Macy’s posted net income of $70 million on net sales of $5.3 billion, for 24 cents a share. Unfortunately, that missed analyst estimates by a whopping $130 million on revenue and a full 10 cents per share.

However, the company’s new CEO, Jeffrey Gennette, said that the numbers were “consistent with our expectations, and we remain on track to meet our 2017 guidance.” Gennette only came on board in March of this year, so this was his first quarterly report as CEO.

And the man has plans. They sound like good ones, too. The problem is, he is fighting against a very strong tide.

Challenges and Solutions

Like all other players in the retail sector, Macy’s has some formidable obstacles in its path back to revenue growth. Of course, each chain has different resources to meet those challenges, as well as options to deal with them. Macy’s actually seems to be in a relatively positive position at this point, despite recent performance.

The Amazon (NASDAQ:AMZN) Curse

The entire retail industry has been steadily declining over the last several years, and it isn’t hard to find the culprit. Amazon’s enormous retailing unit continues to gain market share. Of course, bricks and mortar bookstores were the first to fall, but the online behemoth has been very aggressive in entering the fashion and apparel markets in the last few years.

Over a year ago, analysts from Morgan Stanley estimated that Amazon constituted about 7% of the apparel market in the U.S., and that was…