Nordstrom (JWN) earnings Q3 2019

on Nov21
by | Comments Off on Nordstrom (JWN) earnings Q3 2019 |

Rolls of gift paper hang on display at a Nordstrom Local concept store in New York, Sept. 5, 2019.

Demetrius Freeman | Bloomberg | Getty Images

Shares of Nordstrom spiked more than 10% during extended trading Thursday after the company reported fiscal third-quarter earnings that beat analysts’ estimates, and narrowed its 2019 earnings forecast.

Sales fell 2% from year-ago levels but were in-line with expectations.

Here’s how the retailer compared with Wall Street’s expectations, according to Refinitiv consensus estimates:

  • Earnings per share: 81 cents vs. 64 cents, expected
  • Revenue: $3.67 billion vs. $3.67 billion, expected

In the quarter ended Nov. 2, net income fell to $126 million, or 81 cents per share, from $67 million, or 39 cents a share, a year ago. Analysts surveyed by Refinitiv expected the company to earn 64 cents per share.

Total revenue fell to $3.67 billion, from $3.75 billion a year ago, but matched estimates.

Nordstrom also reiterated its sales forecast and narrowed its earnings outlook range to between $3.30 and $3.50 per share for the fiscal year. The company previously forecast the lower end of that range at $3.25 per share.

“The impact of tariffs is not expected to be material for the year,” the company added.

So far, Nordstrom has not escaped the broader trend of declining sales for mall-based retailers, and its stock is down roughly 26% year to date. Last quarter, the retailer cut its sales and earnings forecast for the fiscal year.

The company opened its first flagship women’s store in New York in October, though sales from the new opening will likely not materialize until the fourth quarter, the company said in August.

The new store received about 85,000 visits during the first weekend, the company said in its earnings release, adding that strong sales in its separate men’s store topped expectations.

In late October, Nordstrom’s board declined a proposal to allow co-presidents Pete and Erik Nordstrom to raise their stake in the company. The company also mentioned that the board had talks with the two over “succession planning.”

Credit Suisse analyst Michael Binetti said in a note last week that the decision “removes some downside support for the stock in the near-term.” The analyst also was concerned about elevated levels of promotions across the market, which can hurt profits.

So far this week, investor sentiment on retail earnings has varied. Shares of Macy’s slid as much as 10% on its mixed third-quarter earnings, while L Brands shares popped more than 7% after the company’s own mixed quarterly earnings.

Nordstrom shares closed at $34.32 per share Thursday.

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