Overview
Nordstrom, Inc.: An Analysis of JWN’s NYSE Performance for the Early 2022 Fiscal Year
How
Gain an understanding of current events and/or situations that might have an impact on the stock price for Nordstrom, which in turn, affects the financial health of the company, and the measure of the growth or decline of a company. Learn about events that directly relate to the study of microeconomics and macroeconomics in the domestic and international economy.
Role
Research, Copywriting
Nordstrom Inc, a leading fashion retailer that offers a wide selection of women’s, men’s, and children’s apparel, shoes, accessories, intimates, home furnishings, electronics, and more, is a publicly traded company listed on the New York Stock Exchange under the ticker symbol JWN. Over the course of the late January to early April 2022, JWN has made significant transformations and announcements within their company that has altered their business. In a broader sense, the Seattle-based company underwent internal and external changes including announcing plans in early February to adjust and boost revenue for the upcoming 2022 fiscal year. The company is specifically looking to prioritize Nordstrom Rack related-business to continue building their digital presence that they successfully established during the peak of the COVID-19 pandemic. In addition, JWN’s role in the stock market has indirectly been affected by the U.S. economy’s period of inflation with high gas prices in early March. The company’s role as a publicly traded company during this current crisis has undergone notable changes on JWN stock and prices of shares dropping between March 4th and March 11th. When analyzing 2022’s outcomes for JWN, Nordstrom’s performance between January 28th and April 8th have had significant changes reflected in the stock data. Despite the slow increase in prices from institutional investors increasing their JWN holdings and the newly announced JWN quarterly dividend, Nordstrom still had to withstand the significant drops resulting from nationwide inflation and slow trading revenue for the NYSE and fashion retailers. However, Nordstrom’s optimistic anticipation for FY2022 with plans to open new Rack locations and centralize managerial leadership within the company depicts a positive outlook for the recovering business.
Nordstrom Inc., led by CEO Erik Nordstrom, is an upscale American fashion retailer operating more than 350 stores worldwide, consisting of Nordstrom, Nordstrom Local, and Nordstrom Rack locations and digitally through Nordstrom and Rack apps and websites. Founded in 1901 in Seattle, Washington by John W. Nordstrom, the company has expanded to sell a wide variety of apparel and accessories for women, men, and children over time via full-price and off- price retail stores. The company also offers kitchen appliances, bedding and bath products, electronics, luggage and travel items, and home décor. Nordstrom’s brands, divisions, and affiliates also include Last Chance, Topshop, Topman, Miss Selfridge, and HIIT.
On July 29th, 1971, Nordstrom Inc. was first listed publicly on the NASDAQ stock exchange. Eventually in June of 1999, with the new ticker symbol JWN, representing the initials of the company founder, Nordstrom was moved to the NYSE where it remains today. The company’s website address, https://investor.nordstrom.com/investor-relations, details quarterly earnings, financial news, the annual report, events, and more.
When analyzing Nordstrom’s economic performance over the past few months, one major macroeconomic event that heavily impacted JWN has been the COVID-19 pandemic and post-covid adjustments throughout 2022. Within online revenue accounting for 44% of the total sales for JWN throughout COVID’s 2020-2021peak (Bhogaraju, 2022), Nordstrom has begun prioritizing Nordstrom Rack and focusing on digital sales. In fact, in their Q4 report during the Earnings Call conference held on March 1st, 2022, they emphasized lifting sales for Rack via a “multi-layered plan” to “expand its offerings of top brands and source from new vendors to meet customer demand” (Dow Jones Newswires, 2022). This new plan implementation was likely a direct result of the lowest ticketed JWN stock prices between February 25th and March 1st, 2022, as JWN is seeking to rehabilitate Rack sales. COVID-19’s impact on JWN has transformed company values towards accessibility for customers through inventory management and planning accordingly for risks relating to current pandemic disruptions and recuperation.
Another macroeconomic event that's impacted Nordstrom’s economic performance has been the rise of gas prices in the U.S. due to high inflation rates causing crude oil prices to skyrocket. Rising oil prices are worrisome for stock markets as they signify higher costs for many goods, resulting in the Fed working to increase interest rates as a strategy to help combat inflation. In saying this, when gas prices skyrocketed in early March 2022, the higher interest rates and constrained spending for consumers has made the buying and selling of stocks significantly harder (Mitra, 2022). According to the stock data visual included above, for Nordstrom, there was a significant drop in JWN shares between March 4th and March 11th at the brunt of gas prices spiking in the U.S. Although it might not be directly linked to Nordstrom’s business performance, the economic impact of inflation and rising gas prices in America have adverse effects on the stock market, and participating companies such as JWN.
Furthermore, smaller scale matters that have affected JWN’s NYSE performance have also contributed to the fluctuation of share prices between late January and April. One microeconomic event for JWN is their recently added 19 cent per share quarterly dividend given to shareholders in effect on March 28th. (Nordstrom, 2022). The company previously had to suspend its dividend on March 23rd, 2020 in order to recover from the COVID-19 pandemic. However, with a successful profit forecast and revenue above estimates for the 2022 fiscal year, Nordstrom’s improving business will now pay an estimated $121 million in dividends to shareholders annually. (Dividendhike, 2022). This dividend being implemented depicts not only confidence in the company, but a rewarding bonus to investors in JWN. In fact, the dividend proved to be a successful investing incentive, as shortly after the announcement, JWN stock skyrocketed and influenced the company to its highest stock price on April 5th, at $28.66. The resumption of the quarterly dividend has changed JWN’s company performance significantly and attracted more investors into the growing and optimistic company.
Another example of a microeconomic event that impacted JWN is the announcement of chief marketing officer, Scott Meden, and president of Nordstrom Rack, Geevy Thomas, retiring on April 4th. Meden’s and Thomas’ long careers at Nordstrom reflect their excellent impact within the company, as they each worked various management roles and helped lead Nordstrom Rack’s sales from approximately $1.4 billion to $4.8 billion since the 1980s (Garner, 2022). Conversely, new positions of chief customer officer and chief stores officer have been created with the intention of centralizing leadership and responsibility to drive inventory and improve selling prices for Nordstrom Rack. These new leadership positions were created to support Nordstrom’s plan of boosting digital sales following the lowest ticketed JWN stock prices between February 25th and March 1st, to help grow and remodel Nordstrom Rack.
Bhogaraju, S. (2022, March 24). Nordstrom vs. TJX: Which Stock’s Prospects Look Brighter? Nasdaq. https://www.nasdaq.com/articles/nordstrom-vs.-tjx%3A-which-stocks-prospects- look-brighter
Dow Jones Institutional News. (2022, March 11). Chmn Nordstrom Sells 10,178 Of Nordstrom Inc >JWN. Retrieved April 15, 2022, from ProQuest Online database. http://proxy.library.vcu.edu/login?url=https://www-proquest- com.proxy.library.vcu.edu/wire-feeds/chmn-nordstrom-sells-10-178-inc-gt- jwn/docview/2638193260/se-2?accountid=14780
Dow Jones Newswires. (2022, April 4). Birkenstock Wants to Keep Rival Sandals Off Shelves at Nordstrom, Zappos, Other Retailers – WSJ. Retrieved April 15, 2022, from Factiva Online database. file:///Users/tylercarroll/Downloads/Factiva-20220414-1223.pdf
Dow Jones Newswires. (2022, March 16). Press Release: Nordstrom Announces the Resumption of Quarterly Dividend. Retrieved April 15, 2022, from Factiva Online database. file:///Users/tylercarroll/Downloads/Factiva-20220414-1227.pdf
Dow Jones Newswires. (2022, March 2). Nordstrom Doubles Down on Plans to Boost Store Sales -- Market Talk. Retrieved April 15, 2022, from Factiva Online database. file:///Users/tylercarroll/Downloads/Factiva-20220414-1233.pdf
Dow Jones Newswires. (2022, March 23). Press Release: Nordstrom Rack to Open Two New Locations in Fall 2022. Retrieved April 15, 2022, from Factiva Online database. file:///Users/tylercarroll/Downloads/Factiva-20220414-1224.pdf
Garner, S. (2022, April 4). Nordstrom’s Big Moves: Scott Meden, Geevy Thomas Retire + Jamie Nordstrom, Ken Worzel Take New Roles. YahooFinance. https://finance.yahoo.com/news/nordstrom-big-moves-scott-meden-135619530.html
Mitra, M. (2022, March 7). What Soaring Gas and Oil Prices Mean for Your Investments. Money. https://money.com/high-gas-oil-prices-affect-investments/
Nordstrom reinstates dividend. (2022, March 16). Dividendhike. Retrieved April 15, 2022, from https://dividendhike.com/news/2022/03/16/JWN-nordstrom-reinstates-dividend/
Nordstrom Reports Fourth Quarter 2021 Earnings. (2022, March 1). Nordstrom, Inc. . Retrieved April 15, 2022, from https://press.nordstrom.com/news-releases/news-release- details/nordstrom-reports-fourth-quarter-2021-earnings.
Nordstrom. (2022). About Us. Nordstrom, inc.. https://www.nordstrom.com/browse/about?breadcrumb=Home%2FAbout%20Us
Nordstrom. (2022). 2021 Annual report. Nordstrom, Inc. https://press.nordstrom.com/staticfiles/879478f9-0ee8-4b1e-a66a-3bc0eddc83b0
Refinitiv Street Events. (2022, March 1). EDITED TRANSCRIPT: JWN.N - Q4 2021 Nordstrom Inc Earnings Call. Retrieved April 15, 2022, from Refinitiv Online database. https://investor.nordstrom.com/static-files/874af169-d764-4377-a7bc-9017052c2e59
Rivas, T. (2022, March 2). Nordstrom Stock Is Soaring. Its Earnings Were That Good. Barron’s. https://www.barrons.com/articles/nordstrom-stock-price-earnings-51646173317?tesla=y)
Watchlist News. (2022, February 11). Watchlist News - American Consumer News: American Century Companies Inc. Buys 1,556 Shares of Nordstrom, Inc. (NYSE:JWN). Retrieved April 15, 2022, from ProQuest Online database. http://proxy.library.vcu.edu/login?url=https://www.proquest.com/blogs-podcasts- websites/watchlist-news-american-consumer-century/docview/2627321397/se- 2?accountid=14780