I agree mostly what you say, yet the margins shouldn't be the problem for they are not discounting to drive traffic, thus losing out to those that do. (i.e.Macy's)
Just a passing thought. I noticed Nordstrom changing from a family run business to a corporate model once they hooked up with Goldman(were doing gods work) Sachs a few years back when restructuring their debt. They went from employee centric company to a business model of financial engineering to please WS.
3 weak Q's in a row....The Mega bull analyst on this one won't change their colors...but this Holiday season as of this point has JWN struggling again...everyone seems to be blind to the fact that The Rack is cannibalizing sales at flagship stores. The company will never admit it but if you look at regional sales where Racks are you can clearly see sales numbers at flagship stores coming in weaker Q over Q. Also- their internet sales the bulk of purchases are on items heavily discounted. This Q again is shaping up to be a disappointment, their margins are coming in to move product. Inventory controls are not their saving grace just look at the prior three Q's.
Sentiment: Strong Sell
The stock certainly is not behaving well. I would have to agree in regards to Nordstrom loosing its competitive edge for all the reasons I have outlined before. Poring money into IT at the expense of human capital.
Traffic is well off the norm for JWN. Three very uninspiring Q's in a row and a very bullish but often wrong group on mega bull analyst. Back to the mid 50's. 59.48 near term. 56 mid Dec. Enjoy and cash in.
Sentiment: Strong Sell
Search for "SEC Live Filings Digest" to find out more.
Filing in Focus: Nordstrom 8-K, November 14, 2013
Nordstrom, Inc. (JWN) announced its fiscal third quarter financial results, reporting a 6% decline in earnings from a year ago. Earnings were $137M, or $0.69 per share, down from $146M and $0.71 per share. Company-wide same-store sales increased 0.1% with net sales increasing 2.9% to $2.8B. Due to the timing of its Anniversary Sale, its largest sales event of the year, sales appear to be worse than what they really were. Women’s products continue to be the company’s top performing category, with shoes, apparel, and cosmetics leading the way. Nordstrom raised its earnings per share guidance for the year from between $3.60 and $3.70 to between $3.65 and $3.70. It also refined its total sales and same-stores sales outlook, estimating the figures to be in the middle of the previously issued ranges, now expecting 3.5% and 2.5% respectively.
Well, one of them stood up for JWN, but the moderator seemed to imply it was bad....anyway, I guess it was seen as pretty uneventful from the AH trades.
read the fine prints.
Given those extra six shopping days, it's a beat on guidance. Can't compare YoY on a different scale.
Sentiment: Strong Buy
who listen to those idiots anyways !!!
JWN has history or reversal in the next trading day. And it has done 65% of the times.
52 wk high tomorrow.
A lot more PUTS being bought today going into earnings, either folks are protecting their long position or looking for a miss. We shall see if Macy's charm spills over to Nordstrom.
**Nordstrom has always placed a premium on experience**
Not the case anymore, that's my point. I as well don't get it. That is why I was trying to come up with a "why" as to why they have chosen this path in the main line stores.
It looks as they are expanding the Rack stores at a feverish pace, which I hope WS analyst will look at. WS street has been rewarding growth companies with high multiples which would help with the lagging stock price.
Well, you are welcome to that premise - which I cannot accept as it makes zero cents. If one regards managers as simply overhead and not vital to the profitability of the company then I could possibly accept your premise. However, they are not. Nordstrom has always placed a premium on experience (within Nordstrom) and management has a plan (like many large companies) - that identifies the up and comers that will replace the current group of top managers. Anyway, if you are correct then I feel their future financial viability would be at great risk. Guess we will be able to tell which of us is correct my monitoring future results.
I am sticking with my premise in regards to replacing older managers with folks in their early and mid twenties for three reasons. One, they can cut insurance cost by having them on their parents policies until 26, and if they are on company insurance they have less dependents. Two, they can pay them less during slow economic times in order to weather the storm. Three, they are "mobile", which allows the company to move them around at a substantial cost savings(i.e., no homes to sell, families to relocate, low moving expenses). I wouldn't be surprised if they start cutting the hours worked at the Rack to avoid the ACA mandate. Time will tell if this strategy will pay off. IMO.
The work place market has changed since most older folks have retired, and I am afraid that this concept is the new norm...it's a brave new world.