Nordstrom Inc (JWN)
Liquidity ratios
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Current ratio | 1.02 | 1.00 | 0.99 | 0.96 | 1.07 | 0.99 | 1.01 | 0.99 | 0.96 | 0.92 | 0.90 | 0.87 | 0.88 | 0.89 | 0.93 | 0.97 | 0.92 | 0.90 | 0.79 | 0.76 |
| Quick ratio | 0.31 | 0.19 | 0.32 | 0.24 | 0.32 | 0.15 | 0.22 | 0.22 | 0.17 | 0.13 | 0.21 | 0.15 | 0.22 | 0.26 | 0.31 | 0.40 | 0.29 | 0.18 | 0.26 | 0.17 |
| Cash ratio | 0.20 | 0.10 | 0.25 | 0.16 | 0.23 | 0.08 | 0.14 | 0.13 | 0.10 | 0.07 | 0.13 | 0.09 | 0.17 | 0.20 | 0.27 | 0.36 | 0.24 | 0.12 | 0.22 | 0.12 |
Nordstrom Inc's liquidity ratios show fluctuations over the past few quarters.
The current ratio, which measures the company's ability to cover short-term liabilities with current assets, has generally been around 1 or slightly below. This indicates that Nordstrom may have just enough current assets to cover its current liabilities. However, there were quarters where the current ratio dipped below 1, suggesting potential liquidity concerns.
The quick ratio, a more stringent measure of liquidity that excludes inventory from current assets, has also been volatile, ranging from as low as 0.13 to as high as 0.40. This implies that Nordstrom's ability to quickly cover its short-term obligations with highly liquid assets has been inconsistent.
The cash ratio, which specifically looks at the proportion of cash and cash equivalents to current liabilities, has similarly experienced variability. While the ratio has generally stayed below 0.30, indicating that Nordstrom's cash holdings are relatively low compared to its short-term obligations, there have been quarters where the cash ratio improved significantly.
Overall, Nordstrom's liquidity position appears to have fluctuated over the analyzed periods, with some quarters showing signs of potential liquidity strain. The company may need to focus on enhancing its ability to quickly access liquid assets to meet short-term obligations more effectively.
Additional liquidity measure
| Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | Aug 3, 2019 | May 4, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash conversion cycle | days | 52.83 | 59.16 | 43.02 | 44.16 | 56.89 | 62.05 | 52.05 | 44.54 | 61.31 | 49.95 | 26.71 | 32.64 | 0.28 | -3.46 | 12.43 | 18.20 | 16.37 | 19.50 | 8.93 | 18.89 |
The cash conversion cycle of Nordstrom Inc shows fluctuations over the periods analyzed. The cycle measures the time it takes for a company to convert its investments in inventory into cash received from sales.
- The longest cash conversion cycle was observed on Oct 29, 2022, at 62.05 days, indicating that Nordstrom took more time to convert its inventory into sales and subsequently into cash during that period.
- On Jan 30, 2021, the cash conversion cycle was significantly negative at -3.46 days, which suggests that Nordstrom efficiently managed its inventory and collections, converting them into cash before paying its suppliers.
- Across the periods, Nordstrom experienced variability in its cash conversion cycle, potentially influenced by factors such as sales trends, inventory management efficiency, and payment terms with suppliers.
Analyzing and monitoring the cash conversion cycle can provide insights into Nordstrom's operational efficiency and liquidity management. Optimal management of the cycle can help enhance cash flow, reduce working capital requirements, and improve overall financial performance.