Nordstrom (JWN) Downgraded by Zacks Investment Research

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Zacks Investment Research cut shares of Nordstrom (NYSE:JWN) from a buy rating to a hold rating in a research report sent to investors on Wednesday morning.

According to Zacks, “Nordstrom outpaced the industry in the past year backed by a robust surprise history, courtesy of smooth execution of its customer strategy. Earnings surpassed estimates in nine of the last 10 quarters, while it delivered positive sales surprise in five of the last six quarters. Higher sales, lower tax rate, comps growth and solid execution across both full-price and off-price businesses are aiding the quarterly performance. Its focus on store expansion, loyalty program and investments in digital growth remain noteworthy. Despite an otherwise strong third-quarter fiscal 2018, the company’s credit-card interest-related error has hurt investor sentiments. The company estimates to refund less than 4% of its cardholders amounts less than $100. Further, higher cost of investments for occupancy, technology, supply chain and marketing initiatives are denting margins. Higher SG&A expense may also weigh on profitability.”

Several other research analysts have also recently weighed in on JWN. Guggenheim reaffirmed a hold rating on shares of Nordstrom in a research note on Thursday, August 16th. Nomura raised their target price on Nordstrom from $54.00 to $59.00 and gave the company a neutral rating in a research note on Friday, August 17th. Royal Bank of Canada set a $55.00 target price on Nordstrom and gave the company a hold rating in a research note on Friday, August 17th. Telsey Advisory Group raised their target price on Nordstrom from $57.00 to $65.00 and gave the company an outperform rating in a research note on Friday, August 17th. Finally, Morgan Stanley raised their target price on Nordstrom from $44.00 to $47.00 and gave the company an underweight rating in a research note on Friday, August 17th. One equities research analyst has rated the stock with a sell rating, fourteen have given a hold rating and seven have assigned a buy rating to the stock. Nordstrom has a consensus rating of Hold and an average price target of $57.65.

Shares of JWN stock opened at $48.61 on Wednesday. Nordstrom has a fifty-two week low of $45.16 and a fifty-two week high of $67.75. The stock has a market cap of $8.13 billion, a P/E ratio of 14.60, a PEG ratio of 2.25 and a beta of 0.54. The company has a quick ratio of 0.44, a current ratio of 1.12 and a debt-to-equity ratio of 2.23.

Nordstrom (NYSE:JWN) last announced its earnings results on Thursday, November 15th. The specialty retailer reported $0.67 earnings per share for the quarter, beating the Thomson Reuters’ consensus estimate of $0.64 by $0.03. Nordstrom had a return on equity of 51.66% and a net margin of 2.92%. The business had revenue of $3.75 billion during the quarter, compared to analysts’ expectations of $3.68 billion. As a group, sell-side analysts predict that Nordstrom will post 3.6 EPS for the current fiscal year.

Nordstrom announced that its Board of Directors has approved a stock repurchase plan on Wednesday, August 22nd that authorizes the company to buyback $1.50 billion in shares. This buyback authorization authorizes the specialty retailer to repurchase up to 14.4% of its shares through open market purchases. Shares buyback plans are usually an indication that the company’s leadership believes its stock is undervalued.

The business also recently announced a quarterly dividend, which was paid on Tuesday, December 11th. Stockholders of record on Monday, November 26th were issued a dividend of $0.37 per share. This represents a $1.48 annualized dividend and a dividend yield of 3.04%. The ex-dividend date of this dividend was Friday, November 23rd. Nordstrom’s dividend payout ratio is 50.00%.

In related news, VP Robert Sari sold 8,795 shares of the stock in a transaction dated Wednesday, October 10th. The stock was sold at an average price of $62.50, for a total value of $549,687.50. Following the completion of the sale, the vice president now directly owns 14,960 shares of the company’s stock, valued at approximately $935,000. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, insider Blake W. Nordstrom sold 127,251 shares of the stock in a transaction dated Thursday, September 20th. The stock was sold at an average price of $61.51, for a total value of $7,827,209.01. Following the completion of the sale, the insider now directly owns 2,519,436 shares of the company’s stock, valued at $154,970,508.36. The disclosure for this sale can be found here. Corporate insiders own 7.05% of the company’s stock.

Institutional investors have recently made changes to their positions in the stock. Federated Investors Inc. PA lifted its stake in Nordstrom by 22.4% in the 3rd quarter. Federated Investors Inc. PA now owns 1,639 shares of the specialty retailer’s stock worth $98,000 after acquiring an additional 300 shares in the last quarter. First Hawaiian Bank purchased a new stake in Nordstrom in the 3rd quarter worth about $113,000. Captrust Financial Advisors lifted its stake in Nordstrom by 426.1% in the 3rd quarter. Captrust Financial Advisors now owns 2,099 shares of the specialty retailer’s stock worth $126,000 after acquiring an additional 1,700 shares in the last quarter. Centaurus Financial Inc. purchased a new stake in Nordstrom in the 2nd quarter worth about $112,000. Finally, Stratos Wealth Partners LTD. purchased a new stake in Nordstrom in the 3rd quarter worth about $145,000. 59.92% of the stock is owned by hedge funds and other institutional investors.

Nordstrom Company Profile

Nordstrom, Inc, a fashion retailer, provides apparel, shoes, cosmetics, and accessories for women, men, young adults, and children in the United States and Canada. The company operates in two segments, Retail and Credit. The Retail segment offers a range of brand name and private label merchandise through various channels, including Nordstrom branded full-line stores and online store at Nordstrom.com; Nordstrom Rack stores; Nordstromrack.com and HauteLook; Trunk Club clubhouses and TrunkClub.com; Jeffrey boutiques; and clearance stores that operate under the Last Chance name.

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