NEW YORK (TheStreet) -- Nordstrom (JWN) shares are up 1.5% to $70.65 on Thursday after the retailer approved a $1 billion share repurchase program with the company using cash on hand to fund the purchase.
Nordstrom shares declined last month after the company reported weak second quarter sales of $3.3 billion which missed analysts expectations of $3.4 billion.
The stock reached a lifetime intraday trading high of $70.82 earlier today following the news.
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TheStreet Ratings team rates NORDSTROM INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate NORDSTROM INC (JWN) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, expanding profit margins, growth in earnings per share and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 7.3%. Since the same quarter one year prior, revenues slightly increased by 6.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- 40.95% is the gross profit margin for NORDSTROM INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 5.39% is above that of the industry average.
- NORDSTROM INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NORDSTROM INC increased its bottom line by earning $3.72 versus $3.56 in the prior year. This year, the market expects an improvement in earnings ($3.90 versus $3.72).
- The change in net income from the same quarter one year ago has significantly exceeded that of the Multiline Retail industry average, but is less than that of the S&P 500. The net income has decreased by 0.5% when compared to the same quarter one year ago, dropping from $184.00 million to $183.00 million.
- You can view the full analysis from the report here: JWN Ratings Report