Retail

What to Look for in Nordstrom Earnings

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Nordstrom Inc. (NYSE: JWN) is set to report its fiscal third-quarter financial results after the markets close on Thursday. The consensus estimates from Thomson Reuters call for $0.51 in earnings per share (EPS) and $3.48 billion in revenue. The same period of last year reportedly had EPS of $0.57 and $3.33 billion in revenue.

Recently across United States, the top-performing merchandise categories have been Beauty and Shoes. The younger customer-focused departments in Women’s Apparel continued to outperform, demonstrating strength in denim and collaborations with new and emerging brands that have limited distribution some expect this to continue in the third quarter. In the July earnings report, the Midwest was the top-performing geographic region.

Over the past several quarters, Nordstrom has been actively addressing its inventory, expense and capital, and in the second quarter, made substantial progress by bringing down inventory in line with sales. Those efforts, along with the strength of its Anniversary Sale and a great response from customers to that event, drove better-than-expected results for the second quarter. The company is hoping to continue these trends into the third quarter and holiday season.

Shareholders were optimistic on Thursday after rival retailers Macy’s and Kohl’s reported fiscal third-quarter results that stunned investors.

A few analysts weighed in on Nordstrom ahead of earnings:

  • Deutsche Bank has a Hold rating.
  • Guggenheim has a Buy rating with a $60 price target.
  • Stifel has a Buy rating with a $58 price target.
  • Cowen reiterated an Outperform with a $55 price target.
  • RBC Capital Markets has a Sector Perform rating with a $47 price target.
  • Morgan Stanley has an Underweight rating with a $36 price target.

Excluding Thursday’s move, Nordstrom has performed more or less in line with the broad markets, with the stock up 5% year to date.

Shares of Nordstrom were last seen up nearly 9% at $56.90, with a consensus analyst price target of $49.38 and a 52-week trading range of $35.01 to $64.51.

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