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Nordstrom Strengthens Liquidity to Lessen Coronavirus Impact
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Nordstrom, Inc. (JWN - Free Report) continues to take proactive measures in wake of the increasing concerns tied to the coronavirus pandemic. To this end, the company recently amended its $800-million revolving line of credit and closed the 8.75%-secured debt offering worth $600 million to reinforce its financial position.
Per the latest amendment terms, the revolving line of credit will be secured by the company’s inventory when its leverage ratio — Adjusted Debt to EBITDAR — exceeds four times, or the credit ratings go below investment grade. Also, the minimum liquidity thresholds are applicable here.
The fashion retailer had also taken several measures to survive such tough times. Apart from shuttering its outlets, it has suspended its quarterly cash dividend, starting the second quarter of fiscal 2020 and also put share buybacks on hold. It had drawn $800 million from its revolving credit facility. Apart from this, it has announced plans to cut down on operating expenses, capital expenditures and working capital to the tune of roughly $500 million, which will be incremental to its initial savings goal of $200-$250 million for fiscal 2020.
The Seattle, WA-based company’s shares have plummeted 52.6% in the past three months, while its industry has lost 42.3%. Nordstrom currently has a Zacks Rank #5 (Strong Sell).
The retail sector has been badly hit by the COVID-19 pandemic. Companies are resorting to various measures to fight or minimize its impact. Women’s apparel retailer, L Brands (LB - Free Report) has suspended quarterly dividend, cut down on capital expenditures and has drawn $950 million from the revolving credit facility. It has also temporarily reduced base compensation by 20% for senior vice presidents, deferred annual merit increases and furloughed majority of its store associates effective Apr 5, till further notice.
Renowned omni-channel retailer, Macy’s (M - Free Report) has suspended second-quarter fiscal 2020 dividend and lowered capital expenditures for the current fiscal year. The company has also chosen to access the $1.5 billion available under the revolving credit facility. Apparel and accessories dealer, Tilly's (TLYS - Free Report) has borrowed $23.7 million under its credit facility, shut down the distribution center in Irvine, CA, and furloughed most of its associates. It has also recognized additional cost reductions for fiscal 2020.
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Nordstrom Strengthens Liquidity to Lessen Coronavirus Impact
Nordstrom, Inc. (JWN - Free Report) continues to take proactive measures in wake of the increasing concerns tied to the coronavirus pandemic. To this end, the company recently amended its $800-million revolving line of credit and closed the 8.75%-secured debt offering worth $600 million to reinforce its financial position.
Per the latest amendment terms, the revolving line of credit will be secured by the company’s inventory when its leverage ratio — Adjusted Debt to EBITDAR — exceeds four times, or the credit ratings go below investment grade. Also, the minimum liquidity thresholds are applicable here.
The fashion retailer had also taken several measures to survive such tough times. Apart from shuttering its outlets, it has suspended its quarterly cash dividend, starting the second quarter of fiscal 2020 and also put share buybacks on hold. It had drawn $800 million from its revolving credit facility. Apart from this, it has announced plans to cut down on operating expenses, capital expenditures and working capital to the tune of roughly $500 million, which will be incremental to its initial savings goal of $200-$250 million for fiscal 2020.
The Seattle, WA-based company’s shares have plummeted 52.6% in the past three months, while its industry has lost 42.3%. Nordstrom currently has a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
What Else?
The retail sector has been badly hit by the COVID-19 pandemic. Companies are resorting to various measures to fight or minimize its impact. Women’s apparel retailer, L Brands (LB - Free Report) has suspended quarterly dividend, cut down on capital expenditures and has drawn $950 million from the revolving credit facility. It has also temporarily reduced base compensation by 20% for senior vice presidents, deferred annual merit increases and furloughed majority of its store associates effective Apr 5, till further notice.
Renowned omni-channel retailer, Macy’s (M - Free Report) has suspended second-quarter fiscal 2020 dividend and lowered capital expenditures for the current fiscal year. The company has also chosen to access the $1.5 billion available under the revolving credit facility. Apparel and accessories dealer, Tilly's (TLYS - Free Report) has borrowed $23.7 million under its credit facility, shut down the distribution center in Irvine, CA, and furloughed most of its associates. It has also recognized additional cost reductions for fiscal 2020.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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