Why Nordstrom’s Earnings Beat Wasn’t Enough

By Chris Lange Updated Jan 11, 11:26PM EST · Published May 18, 8:40AM EDT

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Why Nordstrom’s Earnings Beat Wasn’t Enough — © Thinkstock

Nordstrom Inc. (NYSE: JWN) released its fiscal first-quarter financial results after the markets closed on Thursday. The retailer said that it had $0.51 in earnings per share (EPS) on $3.56 billion in revenue, compared with consensus estimates from Thomson Reuters that called for $0.44 in EPS on revenue of $3.46 billion. The same period of last year reportedly had EPS of $0.37 and $3.35 billion in revenue.

During the quarter, comparable sales increased 0.6%. Total company net sales increased 5.8% in this time, primarily due to the shift of a Nordstrom Rewards loyalty event into the first quarter relative to the second quarter last year.

Also, Nordstrom increased sales enabled through digital capabilities by 18% in the first quarter, compared with the same period in 2017. Digitally enabled sales represented 29% of first-quarter sales, up from 25% a year ago.

Sales from Nordstrom Rewards customers represented 53% of first-quarter sales, compared with 47% last year.

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Looking ahead to the 2018 fiscal full year, the company expects to see EPS in the range of $3.35 to $3.55 and revenues between $15.2 billion and $15.4 billion, with comparable sales of 0.5% to 1.5%. The consensus estimates call for $3.43 in EPS on $15.71 billion in revenue for the full year.

On the books, Nordstrom cash and cash equivalents totaled $966 million at the end of the quarter, versus $653 million at the end of the same period of last year.

Shares of Nordstrom closed on Thursday at $50.91, with a consensus analyst price target of $51.19 and a 52-week range of $37.79 to $54.00. Following the announcement, the stock was down 7% at $47.38.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.