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Nordstrom (JWN) Reports Earnings Tomorrow. What To Expect

StockStory - Wed Aug 23, 11:10AM CDT

JWN Cover Image

Luxury department store chain Nordstrom (NYSE:JWN) will be reporting results tomorrow after market hours. Here's what to look for.

Last quarter Nordstrom reported revenues of $3.18 billion, down 10.9% year on year, beating analyst revenue expectations by 2.11%. It was a decent quarter for the company, with a beat of analysts' revenue estimates. Gross margin also improved significantly.

Is Nordstrom buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Nordstrom's revenue to decline 9.97% year on year to $3.69 billion, a deceleration on the 12% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.45 per share.

Nordstrom Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 3.77%.

Looking at Nordstrom's peers in the department store segment, some of them have already reported Q2 earnings results, giving us a hint of what we can expect. Macy's revenues decreased 9.03% year on year, beating analyst estimates by 3.33%, and Kohl's reported revenue decline of 4.7% year on year, exceeding estimates by 4.96%. Macy's was down 7.84% on the results, and Kohl's traded up 1.01%.

Read our full analysis of Macy's's results here and Kohl's's results here.

There has been a stampede out of high valuation technology stocks and while some of the department store stocks have fared somewhat better, they have not been spared, with share price declining 6.13% over the last month. Nordstrom is down 19.7% during the same time, and is heading into the earnings with an analyst price target of $20.5, compared to share price of $17.32.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.