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Factors Likely to Cast a Pall Over Nordstrom (JWN) Q2 Earnings
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Nordstrom, Inc. (JWN - Free Report) is scheduled to release second-quarter fiscal 2020 numbers on Aug 25, after the closing bell. In the last reported quarter, the fashion specialty retailer recorded a negative earnings surprise of 84.30%. The company delivered a negative earnings surprise of 11.3%, on average, in the trailing four quarters.
The Zacks Consensus Estimate for fiscal second-quarter loss is pegged at $1.43, suggesting deterioration from earnings of 90 cents in the year-ago period. Notably, the consensus estimate has remained stable in the past 30 days. The consensus mark for sales is pegged at $2.31 billion, indicating a decline of 40.4% from the year-ago reported figure.
Factors to Note
Nordstrom’s top line in the second quarter is likely to have been hurt by store closures. Management in its last earnings call had announced to permanently close three Jeffrey specialty stores. This is in addition to the 16 full-line store closures announced earlier.
Moreover, softness in the average selling price might have taken a toll on Nordstrom’s full-price and off-price sales. The impending quarter’s performance is also expected to have been adversely impacted by consumers’ altered shopping pattern amid the coronavirus pandemic. Increased stay-at-home practice might have kept consumers from spending on apparels, shoes and other accessories.
Meanwhile, increased digital sales are likely to have aided the quarterly performance. Markedly, the company has been investing in technology and boosting e-commerce presence. This along with efforts to improve supply-chain and brand marketing is likely to have served as upsides.
Further, any increase in markdowns and deleverage on occupancy costs are likely to have pressurised gross profit margins.
Our proven model does not conclusively predict an earnings beat for Nordstrom this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
While the company carries an Earnings ESP of +10.32%, its Zacks Rank #4 (Sell) makes surprise prediction difficult.
Stocks With a Favorable Combination
Here are a few companies you may want to consider, as our model shows that these have the right combination to post an earnings beat:
Dollar General (DG - Free Report) has an Earnings ESP of +6.88% and a Zacks Rank #2 (Buy).
Best Buy (BBY - Free Report) has an Earnings ESP of +0.24% and a Zacks Rank #2.
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Factors Likely to Cast a Pall Over Nordstrom (JWN) Q2 Earnings
Nordstrom, Inc. (JWN - Free Report) is scheduled to release second-quarter fiscal 2020 numbers on Aug 25, after the closing bell. In the last reported quarter, the fashion specialty retailer recorded a negative earnings surprise of 84.30%. The company delivered a negative earnings surprise of 11.3%, on average, in the trailing four quarters.
The Zacks Consensus Estimate for fiscal second-quarter loss is pegged at $1.43, suggesting deterioration from earnings of 90 cents in the year-ago period. Notably, the consensus estimate has remained stable in the past 30 days. The consensus mark for sales is pegged at $2.31 billion, indicating a decline of 40.4% from the year-ago reported figure.
Factors to Note
Nordstrom’s top line in the second quarter is likely to have been hurt by store closures. Management in its last earnings call had announced to permanently close three Jeffrey specialty stores. This is in addition to the 16 full-line store closures announced earlier.
Moreover, softness in the average selling price might have taken a toll on Nordstrom’s full-price and off-price sales. The impending quarter’s performance is also expected to have been adversely impacted by consumers’ altered shopping pattern amid the coronavirus pandemic. Increased stay-at-home practice might have kept consumers from spending on apparels, shoes and other accessories.
Meanwhile, increased digital sales are likely to have aided the quarterly performance. Markedly, the company has been investing in technology and boosting e-commerce presence. This along with efforts to improve supply-chain and brand marketing is likely to have served as upsides.
Further, any increase in markdowns and deleverage on occupancy costs are likely to have pressurised gross profit margins.
Nordstrom, Inc. Price, Consensus and EPS Surprise
Nordstrom, Inc. price-consensus-eps-surprise-chart | Nordstrom, Inc. Quote
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Nordstrom this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
While the company carries an Earnings ESP of +10.32%, its Zacks Rank #4 (Sell) makes surprise prediction difficult.
Stocks With a Favorable Combination
Here are a few companies you may want to consider, as our model shows that these have the right combination to post an earnings beat:
Big Lots (BIG - Free Report) currently has an Earnings ESP of +5.04% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar General (DG - Free Report) has an Earnings ESP of +6.88% and a Zacks Rank #2 (Buy).
Best Buy (BBY - Free Report) has an Earnings ESP of +0.24% and a Zacks Rank #2.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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