Nordstrom Board Member Trades Company's Stock

Disclosed in the latest SEC filing, a significant insider purchase on June 4, involves Amie Thuener O'Toole, Board Member at Nordstrom JWN.

What Happened: O'Toole made a significant move by purchasing 7,170 shares of Nordstrom as reported in a Form 4 filing with the U.S. Securities and Exchange Commission. The transaction's total worth stands at $164,981.

The latest market snapshot at Wednesday morning reveals Nordstrom shares up by 0.13%, trading at $22.32.

All You Need to Know 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.

Key Indicators: Nordstrom's Financial Health

Revenue Growth: Nordstrom's revenue growth over a period of 3 months has faced challenges. As of 30 April, 2024, the company experienced a revenue decline of approximately -24.55%. This indicates a decrease in the company's top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Consumer Discretionary sector.

Holistic Profitability Examination:

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

• Earnings per Share (EPS): Nordstrom's EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of -0.24.

Debt Management: Nordstrom's debt-to-equity ratio is notably higher than the industry average. With a ratio of 5.07, the company relies more heavily on borrowed funds, indicating a higher level of financial risk.

Assessing Valuation Metrics:

• Price to Earnings (P/E) Ratio: Nordstrom's P/E ratio of 12.05 is below the industry average, suggesting the stock may be undervalued.

• 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 of 5.72 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.

Market Capitalization: Indicating a reduced size compared to industry averages, the company's market capitalization poses unique challenges.

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Uncovering the Importance of Insider Activity

Insider transactions serve as a piece of the puzzle in investment decisions, rather than the entire picture.

In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Breaking Down the Significance of Transaction Codes

In the domain of transactions, investors frequently turn their focus to those taking place in the open market, as meticulously outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals 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.