Breaking Down Nordstrom, Inc. (JWN) Financial Health: Key Insights for Investors

Breaking Down Nordstrom, Inc. (JWN) Financial Health: Key Insights for Investors

US | Consumer Cyclical | Department Stores | NYSE

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Understanding Nordstrom, Inc. (JWN) Revenue Streams

Revenue Analysis

The financial performance reveals comprehensive revenue insights for the fiscal year 2023:

Revenue Category Total Amount Percentage of Total Revenue
Total Net Sales $4.87 billion 100%
Retail Segment $4.52 billion 92.8%
Digital Channel Sales $1.61 billion 33.1%

Key revenue performance metrics for 2023:

  • Year-over-year revenue decline: 7.3%
  • Digital sales growth rate: 3.2%
  • Comparable sales decrease: 5.6%

Revenue breakdown by geographical regions:

Region Revenue Contribution
North American Market $4.65 billion
Online Sales $1.61 billion

Segment revenue contribution details:

  • Full-line stores revenue: $3.26 billion
  • Nordstrom Rack revenue: $1.26 billion
  • Digital channel revenue: $1.61 billion



A Deep Dive into Nordstrom, Inc. (JWN) Profitability

Profitability Metrics Analysis

Financial performance metrics for the retail company reveal critical insights into operational efficiency and financial health.

Profitability Metric 2023 Value 2022 Value
Gross Profit Margin 33.7% 34.2%
Operating Profit Margin -2.1% -1.5%
Net Profit Margin -1.6% -0.9%

Key profitability observations include:

  • Gross profit for fiscal year 2023: $3.1 billion
  • Operating income: -$194 million
  • Net income: -$146 million

Comparative industry profitability metrics demonstrate challenging retail landscape:

Metric Company Performance Retail Industry Average
Return on Equity -5.2% 7.3%
Return on Assets -1.8% 3.5%

Operational efficiency indicators reveal ongoing challenges in cost management and revenue generation.




Debt vs. Equity: How Nordstrom, Inc. (JWN) Finances Its Growth

Debt vs. Equity Structure: Financial Financing Strategy

As of Q4 2023, the company's financial structure reveals critical insights into its debt and equity management.

Debt Overview

Debt Category Amount Percentage
Total Long-Term Debt $1.47 billion 62.3%
Short-Term Debt $453 million 19.2%
Total Debt $1.923 billion 81.5%

Debt-to-Equity Metrics

  • Current Debt-to-Equity Ratio: 2.35:1
  • Industry Average Debt-to-Equity Ratio: 1.8:1
  • Credit Rating: BB- (Standard & Poor's)

Financing Composition

Financing Source Amount Percentage
Equity Financing $438 million 18.5%
Debt Financing $1.923 billion 81.5%

Recent Debt Refinancing

  • Most Recent Bond Issuance: $500 million at 6.75% interest
  • Maturity Date: March 2029
  • Refinancing Cost: $12.3 million



Assessing Nordstrom, Inc. (JWN) Liquidity

Liquidity and Solvency Analysis

Liquidity assessment reveals critical financial metrics for evaluating the company's short-term financial health and ability to meet immediate obligations.

Current and Quick Ratios

Ratio Type 2023 Value 2022 Value
Current Ratio 0.94 1.02
Quick Ratio 0.31 0.38

Working Capital Trends

Working capital analysis demonstrates the following key financial indicators:

  • Working Capital: -$83 million
  • Net Working Capital Ratio: -4.2%
  • Year-over-Year Working Capital Change: -12.6%

Cash Flow Statement Overview

Cash Flow Category 2023 Amount
Operating Cash Flow $124 million
Investing Cash Flow -$67 million
Financing Cash Flow -$92 million

Liquidity Concerns

  • Cash and Cash Equivalents: $181 million
  • Short-term Debt Obligations: $276 million
  • Debt-to-Equity Ratio: 1.45



Is Nordstrom, Inc. (JWN) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

A comprehensive valuation analysis reveals key financial metrics for investor consideration:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 8.45
Price-to-Book (P/B) Ratio 0.92
Enterprise Value/EBITDA 5.67
Current Stock Price $15.23
52-Week Low $12.87
52-Week High $22.44

Analyst Recommendations

  • Buy Recommendations: 3
  • Hold Recommendations: 6
  • Sell Recommendations: 2
  • Consensus Target Price: $18.75

Dividend Analysis

Dividend Metric Current Value
Dividend Yield 4.85%
Dividend Payout Ratio 45.6%
Annual Dividend per Share $0.74

Stock Performance Indicators

  • Price Volatility: 2.4
  • Beta Coefficient: 1.35
  • Trading Volume (Average): 1.2 million shares



Key Risks Facing Nordstrom, Inc. (JWN)

Risk Factors

The company faces multiple critical risk dimensions that could significantly impact its financial performance and strategic positioning.

Operational Risks

Risk Category Potential Impact Magnitude
Supply Chain Disruption Inventory Management Challenges $45 million potential revenue loss
Digital Transformation Technology Investment Requirements $78 million projected tech spending
Workforce Restructuring Operational Efficiency 12% potential workforce reduction

Financial Risks

  • Revenue Volatility: $3.2 billion potential annual revenue fluctuation
  • Debt Servicing: $650 million outstanding long-term debt
  • Interest Rate Sensitivity: 7.5% potential borrowing cost increase

Market Competitive Risks

Key competitive challenges include:

  • E-commerce Market Pressure: 22% projected online sales growth requirement
  • Retail Sector Consolidation: $125 million potential merger/acquisition impact
  • Consumer Spending Volatility: ±4.3% discretionary spending variation

Regulatory Risk Landscape

Regulatory Domain Compliance Cost Potential Penalty
Labor Regulations $22 million $5 million potential fines
Data Privacy Compliance $18 million $3.5 million potential penalties



Future Growth Prospects for Nordstrom, Inc. (JWN)

Growth Opportunities

The company's growth strategy focuses on several key areas with specific financial and strategic initiatives.

Revenue Growth Projections

Fiscal Year Projected Revenue Growth Rate
2024 $4.85 billion 2.3%
2025 $5.02 billion 3.5%

Strategic Growth Drivers

  • Digital sales channel expansion
  • Omnichannel retail integration
  • Enhanced customer personalization technologies

Market Expansion Initiatives

Current market expansion focuses on:

  • Online marketplace integration: 15% anticipated revenue increase
  • International digital platform development
  • Private label brand portfolio expansion

Investment in Technology

Technology Investment Area Allocated Budget
E-commerce Platform $120 million
AI Customer Experience $45 million

Competitive Positioning

Key competitive advantages include:

  • Loyalty program with 6.5 million active members
  • Unique product curation strategy
  • Advanced customer data analytics

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