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Nordstrom (JWN) to Report Q2 Earnings: What's in Store?
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Nordstrom, Inc. (JWN - Free Report) is scheduled to release second-quarter fiscal 2024 numbers on Aug 27, after the closing bell. This fashion specialty retailer is expected to have witnessed revenue growth in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is pegged at $3.84 billion, which indicates a rise of 1.9% from the figure reported in the year-ago quarter.
The consensus estimate for earnings is pegged at 75 cents per share, which indicates a decline of 10.7% from that reported in the year-ago quarter. The consensus mark has moved up by a penny in the past 30 days.
In the last reported quarter, the company missed the earnings estimate by 200%. Also, it delivered a negative earnings surprise of 3.6%, on average, in the trailing four quarters.
Nordstrom’s top-line results in second-quarter fiscal 2024 are likely to reflect benefits from its robust strategic efforts, including the expansion of the reach of Nordstrom Rack and the enhancement of digital capabilities. The company has been focused on the closer-to-you strategy, which aims to link stores and services to expedite deliveries, expand online offerings and add cheaper merchandise at its Rack off-price stores to enrich customers' shopping experiences.
On the last reported quarter’s earnings call, management predicted second-quarter fiscal 2024 revenues to be driven by a 200-bps gain from the timing shift of this year’s anniversary sale. The shift is expected to result in one day of the sale event falling into the third quarter of fiscal 2024 compared with eight days in third-quarter fiscal 2023.
Increased focus on distribution facilities, and improved connectivity of physical and digital capabilities are expected to have boosted the company’s performance in the to-be-reported quarter. It has been introducing more premium brands and better assortments at Rack and increasing brand awareness. These efforts are expected to have driven Rack’s performance and overall sales. Our model estimates a sales rise of 4.4% for the Nordstrom Rack segment in the fiscal second quarter.
However, the company has been susceptible to the impacts of muted customer demand due to uncertainties in the macroeconomic environment. Reduced consumer spending amid lower income groups, stemming from a tough macroeconomic environment, and the impacts of the winding down of Canada operations are likely to have hurt its performance.
These factors, along with higher SG&A expenses on increased labor costs, are likely to have weighed on the company’s bottom-line performance. We expect SG&A expenses to increase 0.5% year over year, while the SG&A expense rate is likely to rise 10 basis points in the fiscal second quarter.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Nordstrom this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Nordstrom has an Earnings ESP of -7.69% and a Zacks Rank of 3 at present.
Valuation Picture
From a valuation perspective, Nordstrom offers an attractive opportunity, trading at a discount relative to historical and industry benchmarks. With a forward 12-month price-to-earnings ratio of 12.41X, which is below the five-year median of 10.31X and the Retail - Apparel and Shoes industry’s average of 16.93X, the stock offers compelling value for investors seeking exposure to the sector. The current Value Score of A adds weight to this optimistic view.
The recent market movements show that Nordstrom shares have gained 19.9% in the year-to-date period compared with the industry's 8.9% growth.
Image Source: Zacks Investment Research
Stocks to Consider
Here are a few companies, which according to our model, have the right combination of elements to post an earnings beat in their upcoming releases.
Abercrombie & Fitch (ANF - Free Report) currently has an Earnings ESP of +5.40% and a Zacks Rank of 2. The company is likely to register top and bottom-line growth when it reports second-quarter fiscal 2024 results. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.1 billion, which indicates an increase of 16.4% from the figure reported in the prior-year quarter.
The consensus estimate for quarterly earnings per share of $2.13 suggests an increase of 93.6% from the year-ago quarter’s reported figure. The Zacks Consensus Estimate for Nordstrom’s earnings has moved up 2.4% in the past 30 days.
American Eagle Outfitters (AEO - Free Report) currently has an Earnings ESP of +1.97% and a Zacks Rank of 2. The company is likely to register top and bottom-line growth when it reports second-quarter fiscal 2024 results. The consensus mark for AEO’s quarterly revenues is pegged at $1.3 billion, which suggests growth of 8.7% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for American Eagle’s earnings has moved up by a penny to 38 cents per share in the past seven days. The consensus estimate indicates growth of 52% from the year-ago quarter’s actual.
Burlington Stores (BURL - Free Report) presently has an Earnings ESP of +6.24% and a Zacks Rank of 3. The company is likely to register growth in the top and bottom lines when it reports second-quarter fiscal 2024 results. The consensus mark for BURL’s quarterly revenues is pegged at $2.4 billion, which suggests 11% growth from the figure reported in the prior-year quarter.
The consensus mark for Burlington Stores’ quarterly earnings has moved up by a penny in the past seven days to 94 cents per share. The consensus estimate suggests an increase of 56.7% from the year-ago quarter’s actual.
Image: Bigstock
Nordstrom (JWN) to Report Q2 Earnings: What's in Store?
Nordstrom, Inc. (JWN - Free Report) is scheduled to release second-quarter fiscal 2024 numbers on Aug 27, after the closing bell. This fashion specialty retailer is expected to have witnessed revenue growth in the to-be-reported quarter. The Zacks Consensus Estimate for revenues is pegged at $3.84 billion, which indicates a rise of 1.9% from the figure reported in the year-ago quarter.
The consensus estimate for earnings is pegged at 75 cents per share, which indicates a decline of 10.7% from that reported in the year-ago quarter. The consensus mark has moved up by a penny in the past 30 days.
In the last reported quarter, the company missed the earnings estimate by 200%. Also, it delivered a negative earnings surprise of 3.6%, on average, in the trailing four quarters.
Nordstrom, Inc. Price and EPS Surprise
Nordstrom, Inc. price-eps-surprise | Nordstrom, Inc. Quote
Key Factors to Note
Nordstrom’s top-line results in second-quarter fiscal 2024 are likely to reflect benefits from its robust strategic efforts, including the expansion of the reach of Nordstrom Rack and the enhancement of digital capabilities. The company has been focused on the closer-to-you strategy, which aims to link stores and services to expedite deliveries, expand online offerings and add cheaper merchandise at its Rack off-price stores to enrich customers' shopping experiences.
On the last reported quarter’s earnings call, management predicted second-quarter fiscal 2024 revenues to be driven by a 200-bps gain from the timing shift of this year’s anniversary sale. The shift is expected to result in one day of the sale event falling into the third quarter of fiscal 2024 compared with eight days in third-quarter fiscal 2023.
Increased focus on distribution facilities, and improved connectivity of physical and digital capabilities are expected to have boosted the company’s performance in the to-be-reported quarter. It has been introducing more premium brands and better assortments at Rack and increasing brand awareness. These efforts are expected to have driven Rack’s performance and overall sales. Our model estimates a sales rise of 4.4% for the Nordstrom Rack segment in the fiscal second quarter.
However, the company has been susceptible to the impacts of muted customer demand due to uncertainties in the macroeconomic environment. Reduced consumer spending amid lower income groups, stemming from a tough macroeconomic environment, and the impacts of the winding down of Canada operations are likely to have hurt its performance.
These factors, along with higher SG&A expenses on increased labor costs, are likely to have weighed on the company’s bottom-line performance. We expect SG&A expenses to increase 0.5% year over year, while the SG&A expense rate is likely to rise 10 basis points in the fiscal second quarter.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Nordstrom this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Nordstrom has an Earnings ESP of -7.69% and a Zacks Rank of 3 at present.
Valuation Picture
From a valuation perspective, Nordstrom offers an attractive opportunity, trading at a discount relative to historical and industry benchmarks. With a forward 12-month price-to-earnings ratio of 12.41X, which is below the five-year median of 10.31X and the Retail - Apparel and Shoes industry’s average of 16.93X, the stock offers compelling value for investors seeking exposure to the sector. The current Value Score of A adds weight to this optimistic view.
The recent market movements show that Nordstrom shares have gained 19.9% in the year-to-date period compared with the industry's 8.9% growth.
Image Source: Zacks Investment Research
Stocks to Consider
Here are a few companies, which according to our model, have the right combination of elements to post an earnings beat in their upcoming releases.
Abercrombie & Fitch (ANF - Free Report) currently has an Earnings ESP of +5.40% and a Zacks Rank of 2. The company is likely to register top and bottom-line growth when it reports second-quarter fiscal 2024 results. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.1 billion, which indicates an increase of 16.4% from the figure reported in the prior-year quarter.
You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for quarterly earnings per share of $2.13 suggests an increase of 93.6% from the year-ago quarter’s reported figure. The Zacks Consensus Estimate for Nordstrom’s earnings has moved up 2.4% in the past 30 days.
American Eagle Outfitters (AEO - Free Report) currently has an Earnings ESP of +1.97% and a Zacks Rank of 2. The company is likely to register top and bottom-line growth when it reports second-quarter fiscal 2024 results. The consensus mark for AEO’s quarterly revenues is pegged at $1.3 billion, which suggests growth of 8.7% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for American Eagle’s earnings has moved up by a penny to 38 cents per share in the past seven days. The consensus estimate indicates growth of 52% from the year-ago quarter’s actual.
Burlington Stores (BURL - Free Report) presently has an Earnings ESP of +6.24% and a Zacks Rank of 3. The company is likely to register growth in the top and bottom lines when it reports second-quarter fiscal 2024 results. The consensus mark for BURL’s quarterly revenues is pegged at $2.4 billion, which suggests 11% growth from the figure reported in the prior-year quarter.
The consensus mark for Burlington Stores’ quarterly earnings has moved up by a penny in the past seven days to 94 cents per share. The consensus estimate suggests an increase of 56.7% from the year-ago quarter’s actual.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.