Nordstrom (JWN) shares rose after the upscale department-store chain said it had furloughed a majority of its workers.
The Seattle company had said last month that it would furlough some workers, as the coronavirus had shut all its stores. But at the time it didn’t indicate the number of affected workers.
“The company has temporarily closed all physical stores to the public without a firm date on when those stores will reopen,” Nordstrom said in a regulatory filing Wednesday.
“A majority of the company’s workforce has been furloughed or assigned zero hours of work, although any or all of such employees may be called back to return to work at any time as the circumstances permit.”
Nordstrom had 68,000 full- and part-time workers in 2019.
The company said it will continue benefits through the end of May for all workers affected by the store closures.
The Nordstrom Executive Leadership Group will lose part of their salaries, and both Chief Executive Erik Nordstrom and President Pete Nordstrom, his brother, will receive no salary from April through September.
Morningstar analyst David Swartz has an optimistic long-term outlook for Nordstrom.
“While we forecast that the company will be unprofitable in 2020 because of the covid-19 crisis, we believe its brand intangible asset will not be affected, and that the company will return to profitability in 2021,” he wrote in a report March 23.
Swartz puts fair value for Nordstrom’s stock at $37.
The shares recently traded at $20, up 11%. Nordstrom’s stock has dropped 54% over the past three months.