Nordstrom financial statement analysis. Nordstrom Inc Analyzing Financial Performance 2022-11-08

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Nordstrom is an American luxury department store chain that was founded in 1901 by John W. Nordstrom and Carl F. Wallin. The company operates more than 350 stores in the United States, Canada, and Puerto Rico, as well as an e-commerce platform. Nordstrom is known for its high-quality products and excellent customer service, and it has a strong reputation in the retail industry.

In this essay, we will perform a financial statement analysis of Nordstrom to better understand the company's financial health and performance. We will begin by reviewing the company's income statement, balance sheet, and cash flow statement, and then we will use various financial ratios to evaluate Nordstrom's financial strength and efficiency.

Income Statement

The income statement is a financial statement that shows a company's revenues, expenses, and profits over a period of time. The income statement for Nordstrom for the fiscal year ending January 30, 2021 (FY2021) shows that the company had total revenues of $15.5 billion, which represents a decline of 15.5% compared to the previous year. This decline was primarily due to the impact of the COVID-19 pandemic on the company's sales.

Nordstrom's expenses for FY2021 included $14.2 billion in cost of goods sold (COGS), $2.6 billion in selling, general, and administrative expenses (SG&A), and $36 million in other expenses. The company's net income for the year was $184 million, which represents a decline of 77.3% compared to the previous year. This decline in net income was due to the decline in sales and the increase in expenses.

Balance Sheet

The balance sheet is a financial statement that shows a company's assets, liabilities, and equity at a specific point in time. Nordstrom's balance sheet as of January 30, 2021 shows that the company had total assets of $8.5 billion, which includes $5.5 billion in current assets and $3.0 billion in non-current assets. The company's current assets include cash and cash equivalents, accounts receivable, and inventory. Nordstrom's non-current assets include property, plant, and equipment, intangible assets, and long-term investments.

Nordstrom's total liabilities as of January 30, 2021 were $6.7 billion, which includes $2.7 billion in current liabilities and $4.0 billion in non-current liabilities. The company's current liabilities include accounts payable, taxes payable, and short-term debt. Nordstrom's non-current liabilities include long-term debt and other long-term obligations.

The company's equity as of January 30, 2021 was $1.8 billion, which represents the residual interest in the assets of the company after liabilities are paid. Nordstrom's equity is made up of common stock, retained earnings, and other comprehensive income.

Cash Flow Statement

The cash flow statement is a financial statement that shows a company's inflows and outflows of cash over a period of time. Nordstrom's cash flow statement for FY2021 shows that the company had net cash provided by operating activities of $660 million, which represents an increase of 8.3% compared to the previous year. This increase in cash flow from operating activities was due to the company's efforts to reduce expenses and improve its working capital.

Nordstrom's net cash used in investing activities for FY2021 was $158 million, which represents a decline of 50.0% compared to the previous year. This decline was due to the company's decision to reduce its capital expenditures in response to the COVID-19 pandemic.

The company's net cash used

Nordstrom is a leading fashion retailer that operates a chain of department stores, as well as an e-commerce platform. The company's financial statements provide valuable information about its financial performance, position, and cash flows. By analyzing Nordstrom's financial statements, we can gain a better understanding of the company's financial health and make informed decisions about its stock or other investments.

First, let's start by looking at Nordstrom's income statement. This statement shows the company's revenue, costs, and profits over a specific period of time, such as a fiscal quarter or year. By comparing Nordstrom's income statement to that of its competitors or to industry averages, we can assess the company's overall financial performance.

One key metric to consider is Nordstrom's gross profit margin, which is calculated by dividing gross profit by revenue. This metric shows the percentage of revenue that remains after subtracting the cost of goods sold. A higher gross profit margin indicates that the company is generating more profit per dollar of sales and may be more efficient at managing its costs.

Next, we can turn to Nordstrom's balance sheet. This statement shows the company's assets, liabilities, and equity as of a specific point in time. By analyzing the balance sheet, we can assess the company's financial position, including its liquidity and solvency.

For example, we can look at Nordstrom's current ratio, which is calculated by dividing current assets by current liabilities. This ratio measures the company's ability to pay its short-term debts using its current assets. A higher current ratio indicates that the company has more liquidity and may be better able to meet its short-term obligations.

Finally, we can analyze Nordstrom's cash flow statement. This statement shows the company's cash inflows and outflows over a specific period of time. By analyzing the cash flow statement, we can assess the company's ability to generate cash and fund its operations.

For example, we can look at Nordstrom's free cash flow, which is calculated by subtracting capital expenditures from net cash provided by operating activities. This metric shows the company's ability to generate cash after paying for its investments in property, plant, and equipment. A positive free cash flow indicates that the company is generating more cash than it is using to fund its growth, which can be a good sign for investors.

Overall, analyzing Nordstrom's financial statements is an important step in understanding the company's financial health and performance. By examining key metrics such as gross profit margin, current ratio, and free cash flow, investors and analysts can make informed decisions about the company's stock or other investments.

Nordstrom financial statement analysis Free Essays

nordstrom financial statement analysis

Wallin; they started off running as a small shoe store located in Seattle, Washington in 1901, and as the years went on, the company expanded and now includes: 122 full-line Nordstrom stores within the U. However, the stance of the company is good and becoming better if we emphasize the increase in RNOA over the two years. Nordstrom will also sell Bonobos products through its online store and through more than 100 brick and mortar stores. Emerging trends in the social and behavioral sciences: An Interdisciplinary, Searchable, and Linkable Resource, 1-14. The external analysis is done by outsiders who do not have access to the detailed internal accounting records of the business firm. With a growth rate of 10%, JWN will have a 14% rate of return. Madhavan Nair as Managing Director of it.

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Nordstrom Financial Statement Analysis

nordstrom financial statement analysis

It started from 1901 in Seattle and has been grown to a powerful retailer in national area. Although both companies have relatively close non-operating expenses to non-operating obligations number cost of debt , the difference in Spread is related to RNOA numbers. Based on the data from balance sheet, on the other hand, the managements utilized more liabilities in 2009 than 2008 to increase the returns. The customized program structure of MPAC at P M School of Business will both enhance my knowledge and make good for my deficiency. In fact, the ratio can also help us compare companies in a different size or different industry. The value for 2011 was 3725.


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Nordstrom Mission Statement 2022

nordstrom financial statement analysis

LankapaliBullayya Degree and P. Even if little money is made from the first sale, the lifetime value of a customer is calculated, and the positive dollar amount of a loyal customer is staggering. An increase in both inventory and AR turnover reduces the Length of the Operating Cycle from 139 days to 131 days. Nordstrom clearly has a higher return than its competitor and is likely to be more profitable than its competitor and industry. Moreover, it shows that Nordstrom uses liabilities or debt to increase operating assets and earnings. . During our analysis of historical and current financial performance of Aeropostale, we found out that the main triggers of revenue growth for the company are the sales in the same store as well as opening of new stores.

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Nordstrom Inc Analyzing Financial Performance

nordstrom financial statement analysis

Cryptocurrencies: Cryptocurrency quotes are updated in real-time. All industry average ratios are sourced from cnbc. The difference between ROE and RNOA shows that there is non-operating return. Elsie Jimenez-Galarza General Electric Company Financial Analysis This essay is continuation of the financial evaluation from last week; we had to choose a company among the Fortune 500 in my case I chose GE Company. The growth and income pick pays an industry-leading dividend yield of 1. In general, JWN has efficient liquidity ratios that allow the company to cover its seasonal cash needs and to maintain appropriate levels of short term borrowings.


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What are Nordstrom Company Financials for the last 10 years

nordstrom financial statement analysis

Nordstrom clearly has a higher return than its competitor and is likely to be more profitable than its competitor and industry. However, the consolidation was not with problems. We analyze your portfolios and positions such as Nordstrom using complex mathematical models and algorithms, but make them easy to understand. Its legendary customer service is a competitive advantage that can't be easily duplicated, and the company spends a lot of time, money, and effort training employees to maintain that distinction. Dealing with diverse competition, upscale retailer Nordstrom has been famous for superior customer service for over 100 years and has been recognized on every 100 Best Companies To Work For list published in Fortune magazine since 1998.

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Financial statement analysis Nordstrom

nordstrom financial statement analysis

Scenarios as a strong support for strategic planning. You aren't allowed to use any part of this example without properly citing it first. The purpose of this report is to provide potential shareholders with information as to why they should buy into the company and existing shareholders with information as to why they should hold their stock. First-quarter same-store sales increased 8. JWN recently acquired online private sales leader HauteLook Inc, which will help the company in building its multi-channel retail format.


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Nordstrom Financial Analysis

nordstrom financial statement analysis

Nordstrom has founded itself upon excellent customer service and an unmatched reputation. Then… Nordstrom Swot Analysis Essay The company is constantly expanding with new full-line stores as well as Nordstrom Rack stores. In addition, JWN also has a much higher dividend payout ratio and dividend yield than DDS. In 1996 Aeropostale expanded from a brand for primarily young men to a brand that offers casual apparel and accessories for both young women… Nordstrom Financial Statement Analysis Nordstrom is classified as an Upscale Independent Department Store Chain and is noted as one of the largest department stores of its type. Upon evaluation of the operating efficiency, Gross profit margin, Return on sale, ROA, and ROE, JWN did a pretty good job during the fiscal year ended Jan 28th, 2012. The financial statement analysis is supplemented by operating indicator analysis. Instead of categorizing departments by merchandise, Nordstrom created fashion departments that fit individual lifestyles.

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Nordstrom financial statement analysis

nordstrom financial statement analysis

The analysis of financial information refers to the process of the critical examination of the financial information contained in the financial statements in order to understand and make the decisions regarding the operations of the firm. Over the years, Nordstrom has been growing their online ecommerce, which has increased sales. Source: FactSet Indexes: Index quotes may be real-time or delayed as per exchange requirements; refer to time stamps for information on any delays. To stay secured and at the top level as the best destination of choice for all its customers, Nordstrom leaves nothing to chance where the quality of both the products and the services related to its operations are concerned. Nordstrom will also sell Bonobos products through its online store and through more than 100 brick and mortar stores. In addition, JWN also invests 16.

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Analysis of Financial Statement

nordstrom financial statement analysis

Although distortion would be beneficial to management, the standards used by Nordstrom to account for stock issued to employees seem well disclosed and straight forward. Nordstrom has established itself as a high-end apparel retailing company. Furthermore, TJX has better operating asset turnover NOAT than Nordstrom, which shows that TJX is converting its operating assets to cash three times faster than Nordstrom. Nordstrom has founded itself upon excellent customer service and an unmatched reputation. Dating back to a Wisconsin supermarket in 1946, founder Max Kohl grew his small business to the most successful chain of supermarkets in the Milwaukee area 12. However, its Time Interest Earned ratio is better than the industry. Macy's Historically speaking, Canada has never been a great market for American retailers.

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