[ACCESSWIRE]
Upcoming AWS Coverage on L Brands Post-Earnings Results
LONDON, UK / ACCESSWIRE / November 21, 2016 / Active Wall St. announces its post-earnings coverage on Nordstrom Inc. (NYSE: JWN). The company reported its third quarter fiscal 2016 (Q3 FY16) earnings on November 10, 2016. The Seattle Washington-based company reported a 7.2% y-o-y growth in its net sales; whereas total revenues beat Wall Street's estimates. Register with us now for your free membership at: http://www.activewallst.com/register/.
One of Nordstrom's competitors within the Apparel Stores space, L Brands, Inc. (NYSE: LB), reported its 2016 third quarter results on November 16, 2016. AWS will be initiating a research report on L Brands in the coming days.
Today, AWS is promoting its earnings coverage on JWN; touching on LB. Get our free coverage by signing up to:
http://www.activewallst.com/registration-3/?symbol=JWN
http://www.activewallst.com/registration-3/?symbol=LB
Earnings Reviewed
During the Q3 FY16, Nordstrom reported total revenues of $3.54 billion compared to $3.33 billion in Q3 FY15. Total revenues number for Q3 FY16 came in marginally above market expectations of $3.49 billion. The company reported net sales of $3.47 billion in Q3 FY16 compared to $3.24 billion in Q3 FY15. In the reported quarter, comparable sales reported a growth of 2.4% versus 0.9% growth in the prior year's quarter.
The department store retailer reported net loss of $10 million, or $0.06 loss per diluted share in Q3 FY16 versus net earnings of $81 million, or $0.42 per diluted share, in the prior year's comparable quarter. Excluding impairments charges, the company's adjusted earnings for Q3 FY16 came in at $148 million, or $0.84 per diluted share, Wall Street had expected the company to report adjusted earnings of $0.52 per diluted share.
Operating Metrics
The company's Q3 FY16 retail gross profit was $1.21 billion compared to $1.10 billion in the prior year's quarter. Retail gross margin as a percentage of net sales for the quarter came in at 34.8% of net sales versus 33.9% of net sales in the year ago period. However, retail earnings before interest and income taxes (EBIT) fell to $23 million from $148 million in Q3 FY15. The company's retail EBIT margin also declined to 0.6% of net sales in Q3 FY16 from 4.6% of net sales in the year ago quarter. Additionally, credit EBIT increased $26 million, which primarily reflected transaction costs incurred in FY15 associated with the sale of the credit card portfolio.
Segment Performance
In Q3 FY16, Nordstrom's full-price net sales, which included U.S. full-line stores and Nordstrom.com, improved to $2.07 billion from $2.05 billion in the previous year's comparable quarter. The segment reported comparable sales growth of 0.5% in Q3 FY16 versus 0.3% in Q3 FY15.
Off-price net sales, which included Nordstrom Rack and Nordstromrack.com/HauteLook, rose to $1.12 billion in the reported quarter from $1.01 billion in Q3 FY15. Additionally, the segment's comparable sales growth was 3.9% in Q3 FY16 versus a positive comparable sales of 2.4% in the year ago quarter.
Furthermore, the company's Corporate/Other sales surged to $155 million, during the reported quarter, from $70 million in Q3 FY15.
Cash Flow and Balance Sheet
In the first nine months ended October 29, 2016, net cash provided by operating activities was $872 million compared to $1.75 billion in the first three quarters of FY15. The company reported negative free cash flow of $72 million during the nine months ended October 29, 2016, compared to a positive cash flow of $702 million during the nine months ended October 31, 2015.
As on October 29, 2016, the company had $531 million in cash and cash equivalents compared to a balance of $821 million as on October 31, 2015. The company reported long-term debt of $2.77 billion in its books of accounts as on October 29, 2016, compared to $2.80 billion as on October 31, 2015.
Nordstrom provided return on assets of 4.2% in the 12 fiscal months ended October 29, 2016, compared to 7.2% on the year ago date, Furthermore, return on invested capital for the 12 fiscal months, stood at 7.2% as on October 29, 2016, versus 11.4% as on October 31, 2015.
Dividends and Share Repurchases
In a separate press release on November 16, 2016, Nordstrom's Board of Directors announced a quarterly dividend of $0.37 per share, payable on December 13, 2016, to shareholders of record at the close of business on November 28, 2016.
During first nine months of FY16, Nordstrom repurchased 1.9 million shares of its common stock for $93 million. Furthermore, the company had a balance of $718 million available under its existing share repurchase board authorization.
Earnings Outlook
In its guidance for full year FY16, Nordstrom expects net sales to rise by approximately 3.5%. The company's anticipated comparable sales growth to be flat during FY16. Earnings per diluted share are forecasted to lie between $1.70 and $1.80 for FY16. Earnings per diluted share, excluding impairment charge, are expected to be in the range of $2.85 to $2.95.
Stock Performance
Last Friday, the stock closed the trading session at $58.94, marginally up 0.75% from its previous closing price of $58.50. A total volume of 4.05 million shares have exchanged hands, which was higher than the 3-month average volume of 3.11 million shares. Nordstrom's stock price advanced 10.98% in the last month, 13.85% in the past three months, and 57.08% in the previous six months. Furthermore, since the start of the year, shares of the company have surged 21.19%. The stock is trading at a PE ratio of 25.08 and has a dividend yield of 2.51%.
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