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Here's Why Nordstrom (JWN) Looks Poised to Beat on Q3 Earnings
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Nordstrom, Inc. (JWN - Free Report) is scheduled to release third-quarter fiscal 2021 numbers on Nov 23, after the closing bell. The fashion specialty retailer is expected to have witnessed revenue and earnings growth in the to-be-reported quarter.
The Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at 56 cents per share, suggesting a substantial increase of 154.6% from the year-ago quarter's reported figure of 22 cents. The consensus mark has moved up 3.7% in the past seven days. The consensus mark for revenues is pegged at $3.54 billion, indicating a rise of 14.5% from the figure reported in the year-ago quarter.
In the last reported quarter, the company witnessed an earnings surprise of 88.5%. It delivered an earnings surprise of 557.3%, on average, in the trailing four quarters.
Nordstrom has been gaining from solid demand, better inventory, stringent cost-cutting actions, and improved sales trends at Nordstrom and Nordstrom Rack as well as across regions and categories. Strength in shoes, apparel and accessories are also expected to have been aided JWN, with active, home and designer categories getting back to the pre-pandemic level.
The company remains focused on technology advancement by boosting e-commerce and digital networks, and improving its supply-chain channels and marketing efforts. Gains from improved digital traffic across both Nordstrom and Nordstrom Rack have been aiding the digital business. Alongside these, the integration of Rack.com onto Nordstrom.com should have contributed to the company's top line in the quarter under review.
On its last reported quarter's earnings call, Nordstrom forecast sales improvement for the third and fourth quarters of fiscal 2021 on a sequential basis.
The company's fiscal third-quarter performance is expected to have benefited from its market strategy, which helps engage with customers through better service and greater access to products, irrespective of the shopping mode. As part of the strategy, Nordstrom expanded facilities like order pickup and ship-to-store to all Nordstrom Rack stores.
JWN also remains focused on the closer-to-you strategy, which aims to link stores and services to expedite deliveries, expand online offerings, and add cheaper merchandise to its Rack off-price stores to improve customers' shopping experiences. A rise in new customers, enhanced personalization and expanded product offering are likely to have aided the fiscal third-quarter results.
However, the company's sales and earnings performances are still short of the pre-pandemic levels. The pre-pandemic period is a more suitable basis for comparison for retailers as elevated COVID-19 impacts related to temporary store closures hurt industry-wide results throughout 2020. Nordstrom is also reeling under higher COVID-related labor and freight costs.
On its last reported quarter's earnings call, management expected freight and labor costs to persist in the second half of fiscal 2021, which are likely to result in higher SG&A from the first half.
What Does the Zacks Model Say?
Our proven model predicts an earnings beat for Nordstrom this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Nordstrom has an Earnings ESP of +0.40% and carries a Zacks Rank #3.
Stocks With the Favorable Combination
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
Costco Wholesale (COST - Free Report) currently has an Earnings ESP of +1.00% and a Zacks Rank of 2. The company is anticipated to register an increase in the bottom and top lines when it reports first-quarter fiscal 2022 results. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for COST's quarterly earnings moved up 2.8% in the last 30 days to $2.59 per share and the same suggests a 13.1% jump from the year-ago quarter's reported number. The Zacks Consensus Estimate for Costco's quarterly revenues is pegged at $49.6 billion, which suggests a rise of 14.8% from the figure reported in the prior-year quarter. The COST stock has rallied 40.7% year to date.
The Kroger Co.'s (KR - Free Report) currently has an Earnings ESP of +3.71% and a Zacks Rank of 3. Although the Zacks Consensus Estimate for quarterly earnings has moved up by a penny in the last 30 days to 66 cents per share, it indicates a 7% decline from the year-ago quarter's reported number.
However, Kroger's top line is expected to have risen year over year. The Zacks Consensus Estimate for KR's quarterly revenues is pegged at $31 billion, suggesting growth of 4.4% from the figure reported in the prior-year quarter. KR's stock has rallied 30.6% year to date.
Foot Locker (FL - Free Report) currently has an Earnings ESP of +7.16% and a Zacks Rank of 3. The company is likely to register growth in the bottom and top lines when it reports third-quarter fiscal 2021. The Zacks Consensus Estimate for FL's quarterly earnings moved up by a penny in the last seven days to $1.32 per share. This suggests a 9.1% jump from the year-ago quarter's reported number.
The Zacks Consensus Estimate for Foot Locker's quarterly revenues is pegged at $2.12 billion, suggesting a rise of 0.8% from the figure reported in the prior-year quarter. The FL stock has gained 39.8% year to date.
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Here's Why Nordstrom (JWN) Looks Poised to Beat on Q3 Earnings
Nordstrom, Inc. (JWN - Free Report) is scheduled to release third-quarter fiscal 2021 numbers on Nov 23, after the closing bell. The fashion specialty retailer is expected to have witnessed revenue and earnings growth in the to-be-reported quarter.
The Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at 56 cents per share, suggesting a substantial increase of 154.6% from the year-ago quarter's reported figure of 22 cents. The consensus mark has moved up 3.7% in the past seven days. The consensus mark for revenues is pegged at $3.54 billion, indicating a rise of 14.5% from the figure reported in the year-ago quarter.
In the last reported quarter, the company witnessed an earnings surprise of 88.5%. It delivered an earnings surprise of 557.3%, on average, in the trailing four quarters.
Nordstrom, Inc. Price and EPS Surprise
Nordstrom, Inc. price-eps-surprise | Nordstrom, Inc. Quote
Key Factors to Note
Nordstrom has been gaining from solid demand, better inventory, stringent cost-cutting actions, and improved sales trends at Nordstrom and Nordstrom Rack as well as across regions and categories. Strength in shoes, apparel and accessories are also expected to have been aided JWN, with active, home and designer categories getting back to the pre-pandemic level.
The company remains focused on technology advancement by boosting e-commerce and digital networks, and improving its supply-chain channels and marketing efforts. Gains from improved digital traffic across both Nordstrom and Nordstrom Rack have been aiding the digital business. Alongside these, the integration of Rack.com onto Nordstrom.com should have contributed to the company's top line in the quarter under review.
On its last reported quarter's earnings call, Nordstrom forecast sales improvement for the third and fourth quarters of fiscal 2021 on a sequential basis.
The company's fiscal third-quarter performance is expected to have benefited from its market strategy, which helps engage with customers through better service and greater access to products, irrespective of the shopping mode. As part of the strategy, Nordstrom expanded facilities like order pickup and ship-to-store to all Nordstrom Rack stores.
JWN also remains focused on the closer-to-you strategy, which aims to link stores and services to expedite deliveries, expand online offerings, and add cheaper merchandise to its Rack off-price stores to improve customers' shopping experiences. A rise in new customers, enhanced personalization and expanded product offering are likely to have aided the fiscal third-quarter results.
However, the company's sales and earnings performances are still short of the pre-pandemic levels. The pre-pandemic period is a more suitable basis for comparison for retailers as elevated COVID-19 impacts related to temporary store closures hurt industry-wide results throughout 2020. Nordstrom is also reeling under higher COVID-related labor and freight costs.
On its last reported quarter's earnings call, management expected freight and labor costs to persist in the second half of fiscal 2021, which are likely to result in higher SG&A from the first half.
What Does the Zacks Model Say?
Our proven model predicts an earnings beat for Nordstrom this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Nordstrom has an Earnings ESP of +0.40% and carries a Zacks Rank #3.
Stocks With the Favorable Combination
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
Costco Wholesale (COST - Free Report) currently has an Earnings ESP of +1.00% and a Zacks Rank of 2. The company is anticipated to register an increase in the bottom and top lines when it reports first-quarter fiscal 2022 results. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for COST's quarterly earnings moved up 2.8% in the last 30 days to $2.59 per share and the same suggests a 13.1% jump from the year-ago quarter's reported number. The Zacks Consensus Estimate for Costco's quarterly revenues is pegged at $49.6 billion, which suggests a rise of 14.8% from the figure reported in the prior-year quarter. The COST stock has rallied 40.7% year to date.
The Kroger Co.'s (KR - Free Report) currently has an Earnings ESP of +3.71% and a Zacks Rank of 3. Although the Zacks Consensus Estimate for quarterly earnings has moved up by a penny in the last 30 days to 66 cents per share, it indicates a 7% decline from the year-ago quarter's reported number.
However, Kroger's top line is expected to have risen year over year. The Zacks Consensus Estimate for KR's quarterly revenues is pegged at $31 billion, suggesting growth of 4.4% from the figure reported in the prior-year quarter. KR's stock has rallied 30.6% year to date.
Foot Locker (FL - Free Report) currently has an Earnings ESP of +7.16% and a Zacks Rank of 3. The company is likely to register growth in the bottom and top lines when it reports third-quarter fiscal 2021. The Zacks Consensus Estimate for FL's quarterly earnings moved up by a penny in the last seven days to $1.32 per share. This suggests a 9.1% jump from the year-ago quarter's reported number.
The Zacks Consensus Estimate for Foot Locker's quarterly revenues is pegged at $2.12 billion, suggesting a rise of 0.8% from the figure reported in the prior-year quarter. The FL stock has gained 39.8% year to date.