Nordstrom Inc. Investment Guide: Financial Insights and Market Potential
Nordstrom Inc. is a leading fashion retailer headquartered in Seattle, Washington. Founded in 1901 as a shoe store, it has grown into a full-line fashion retailer offering clothing, shoes, accessories, and more for men, women, and children. Nordstrom operates over 350 stores across the United States, including Nordstrom Rack locations, and also serves customers online through its websites and apps.
Finance Performance and Ratios
Nordstrom’s financial performance has seen some fluctuations. As of the latest data: Market Cap: Approximately $3.82 billion; P/E Ratio: 14.62; Dividend Yield: 3.36%; Return on Equity (ROE): 35.02%; Return on Assets (ROA): 3.93%; Debt/Equity Ratio: 4.46.
Stock Price Performance and Ratios
Nordstrom’s stock price has experienced volatility over the years. The stock price has ranged from a 52-week low of $15.08 to a high of $24.99.
Investment Insight
This company is facing challenges with declining cash flows and diminishing cash reserves. Despite maintaining a solid gross profit, its net profitability remains extremely low, and the EPS (Earnings Per Share) is on a downward trend. While the company’s high dividend yield, which surpasses that of S&P 500 index stocks, might attract some investors, the overall financial outlook is concerning. However, there is potential for the stock price to grow by an average of about 10% annually, or possibly even faster, in the future, despite the prevailing skepticism.
Nordstrom Stock Forecast**
| MIN/MAX | 2024 | 2025 | 2026 | 2027 | 2028 |
|---|---|---|---|---|---|
| MIN | 11.52 | 13.89 | 16.74 | 20.17 | 24.32 |
| MAX | 19.09 | 23.01 | 27.74 | 33.43 | 40.30 |
When to buy?
Currently, it appears to be an opportune moment to buy stocks, as their price has rebounded from a recent low. This is an ideal time to add to an existing position if you have one. However, if you don’t already own these stocks, it may be wiser to seek out stronger companies with better prospects. Nonetheless, if you are determined to invest, now would be the time to buy and hold for the long term, potentially for decades.
Dividend Policy
Nordstrom has a consistent dividend policy, offering a dividend yield of 3.36%. The company has a payout ratio of 44.57%, indicating a balanced approach to returning profits to shareholders while retaining enough earnings for growth and.
Conclusion
Nordstrom Inc. presents a mixed investment opportunity. While the company faces challenges with declining cash flows and diminishing cash reserves, its high dividend yield and potential for stock price growth may attract certain investors. For those considering an investment, it’s crucial to weigh the risks against the potential rewards and keep an eye on market conditions and the company’s financial health.
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*Investment analysis involves scrutinizing over 50 different criteria to assess a company's ability to generate shareholder value. This comprehensive approach includes tracking revenue, profit, equity dynamics, dividend payments, cash flow, debt and financial management, stock price trends, bankruptcy risk, F-Score, and more. These metrics are consolidated into a straightforward Investment Scoreboard, which effectively helps predict future stock price movements.
**Use the price forecast to manage the risk of your investments.