Nordstrom Director Trades Company's Stock

On June 4, Bradley D Tilden, Director at Nordstrom JWN executed a significant insider buy, as disclosed in the latest SEC filing.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday unveiled that Tilden made a notable purchase of 15,862 shares of Nordstrom, valuing at $364,984.

In the Wednesday's morning session, Nordstrom's shares are currently trading at $22.32, experiencing a up of 0.13%.

About Nordstrom

Nordstrom is a fashion retailer that operates about 93 department stores and more than 260 off-price Nordstrom Rack stores. The company also operates both full- and off-price e-commerce sites, two clearance stores, and seven Local locations. Nordstrom's largest merchandise categories are women's apparel (27% of 2023 sales), shoes (26% of 2023 sales), men's apparel (15% of 2023 sales), and beauty (13% of 2023 sales). Nordstrom, which traces its history to a shoe store opened in Seattle in 1901, continues to be partially owned and managed by members of the eponymous family.

Nordstrom: A Financial Overview

Decline in Revenue: Over the 3 months period, Nordstrom faced challenges, resulting in a decline of approximately -24.55% in revenue growth as of 30 April, 2024. This signifies a reduction in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Consumer Discretionary sector.

Navigating Financial Profits:

  • Gross Margin: The company shows a low gross margin of 33.94%, suggesting potential challenges in cost control and profitability compared to its peers.

  • Earnings per Share (EPS): Nordstrom's EPS reflects a decline, falling below the industry average with a current EPS of -0.24.

Debt Management: Nordstrom's debt-to-equity ratio stands notably higher than the industry average, reaching 5.07. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Insights into Valuation Metrics:

  • Price to Earnings (P/E) Ratio: The current P/E ratio of 12.05 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

  • Price to Sales (P/S) Ratio: The current P/S ratio of 0.25 is below industry norms, suggesting potential undervaluation and presenting an investment opportunity for those considering sales performance.

  • EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio 5.72 is below the industry average, indicating that it may be relatively undervalued compared to peers.

Market Capitalization Analysis: Positioned below industry benchmarks, the company's market capitalization faces constraints in size. This could be influenced by factors such as growth expectations or operational capacity.

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Why Insider Transactions Are Important

Insider transactions contribute to decision-making but should be supplemented by a comprehensive investment analysis.

In the realm of legality, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

Important Transaction Codes

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Nordstrom's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

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