Nordstrom Inc.
JWN : NYSE : Services

$50.28 -0.80 | -1.57%
Today's Range: 50.17 - 50.85
Avg. Daily Volume: 1,759,400
05/30/12 - 4:01 PM ET
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Financial Analysis


NORDSTROM INC's gross profit margin for the first quarter of its fiscal year 2012 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. NORDSTROM INC has strong liquidity. Currently, the Quick Ratio is 1.66 which shows the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 2.38% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.



Income Statement Q1 FY12 Q1 FY11
Net Sales ($mil)2629.02323.0
EBITDA ($mil)381.0358.0
EBIT ($mil)280.0272.0
Net Income ($mil)149.0145.0


Balance Sheet Q1 FY12 Q1 FY11
Cash & Equiv. ($mil)1647.01433.0
Total Assets ($mil)8258.07747.0
Total Debt ($mil)3143.02782.0
Equity ($mil)2083.02134.0


Profitability Q1 FY12 Q1 FY11
Gross Profit Margin43.5944.08
EBITDA Margin14.4915.41
Operating Margin10.6511.71
Sales Turnover1.351.28
Return on Assets8.328.29
Return on Equity32.9830.08
Debt Q1 FY12 Q1 FY11
Current Ratio2.411.95
Debt/Capital0.60.57
Interest Expense40.031.0
Interest Coverage7.08.77


Share Data Q1 FY12 Q1 FY11
Shares outstanding (mil)208.6219.8
Div / share0.270.23
EPS0.70.65
Book value / share9.999.71
Institutional Own % n/a n/a
Avg Daily Volume1807381.02264346.0

Valuation


BUY. The current P/E ratio indicates a premium compared to an average of 15.68 for the Multiline Retail industry and a value on par with the S&P 500 average of 15.19. For additional comparison, its price-to-book ratio of 5.05 indicates a significant premium versus the S&P 500 average of 2.12 and a significant premium versus the industry average of 3.32. The current price-to-sales ratio is below the S&P 500 average, but above the industry average. Upon assessment of these and other key valuation criteria, NORDSTROM INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
JWN 15.77 Peers 15.68   JWN 9.20 Peers 10.55

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

JWN is trading at a valuation on par with its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

JWN is trading at a discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
JWN 12.94 Peers 14.68   JWN 1.60 Peers 10.09

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

JWN is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

JWN trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
JWN 5.05 Peers 3.32   JWN 11.11 Peers -256.70

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

JWN is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

JWN is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
JWN 0.94 Peers 0.74   JWN 12.55 Peers 6.14

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

JWN is trading at a significant premium to its industry.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

JWN has a sales growth rate that significantly exceeds its peers.

 

 

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