Trading volume in Macy's shares blew past its 30-day average volume by about 11:30 a.m. ET.
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Macy's could function as two companies, split between its operating business and real estate holdings, Smith said. Smith, who is chairman of Darden Restaurants' board, added that the company holds more than $20 billion in real estate value.
"We believe there is an opportunity to create two leading companies ... while maintaining the dividend," Smith said.
"We work continuously to maximize shareholder value and exchange views with a wide variety of shareholders as we do so," a Macy's spokesman said in response to Smith's remarks."This is an ongoing process of disciplined allocation of capital that has included share repurchases, increased dividends and continued investments in our business, which has led to superior operating performance compared to the majority of our competitors. Note that Macy's, Inc.'s Total Shareholder Return over the past six years has been 700 percent, compared with 115 percent for the Dow Jones average over the same period.
"Our real estate strategy is to have a mix of owned and leased stores in order to maximize both profitability and operational flexibility," the spokesman added. "We continuously evaluate all our locations and their retail and alternative use values."
During the Alpha ideas panel, Tom Sandell of Sandell Asset Management outlined opportunities in furniture retailer Ethan Allen, which traded more than 4 percent higher by afternoon after his remarks. Sandell also cited the value of real estate holdings, the company's balance sheet and the strength of its brand name.
Sandell said his firm is one of Ethan Allen's "largest shareholders" but has not yet disclosed its stake. The company's market capitalization still sits below $1 billion.
Keith Meister of Corvex Management also unveiled a play on real estate with American Realty Capital Properties. The company's shares climbed after Meister spoke and were more than 2.7 percent higher Wednesday afternoon.
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Meister called the investment "bond-like risk with equity-like returns." He noted that he sees upside between 25 and 50 percent.
Corvex owns about 8 percent of ARCP's shares, Meister said.
Addressing alleged accounting fraud at the company, Meister noted that he believes management has taken steps to increase accountability.
UPDATED: This story was updated to include comments from Macy's.