Nordstrom Inc (JWN)
Profitability ratios
Return on sales
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 63.62% | 66.99% | 65.91% | 59.06% | 33.50% |
| Operating profit margin | 27.24% | 33.99% | 31.83% | 18.11% | 37.83% |
| Pretax margin | 1.00% | 2.17% | 1.66% | -11.46% | 4.39% |
| Net profit margin | 0.91% | 1.58% | 1.20% | -6.44% | 3.20% |
Nordstrom Inc's profitability ratios show a mixed performance over the past five fiscal years. The gross profit margin has fluctuated, with a significant increase in 2021 followed by a slight decline in 2022 and further reduction in 2023 and 2024. This may indicate changes in the company's cost structure and pricing strategies impacting its ability to generate profits on sales.
The operating profit margin has also varied, with a notable peak in 2020, followed by a decline in the subsequent years. This suggests fluctuations in operating expenses relative to revenue, highlighting potential challenges in managing costs effectively to maximize operating income.
The pretax margin demonstrates significant volatility, with a negative margin in 2021 indicating a loss before taxes. This raises concerns about the company's overall financial health and ability to generate sustainable profits during that period. However, there has been a gradual improvement in profitability since then, as seen in the positive pretax margins in 2023 and 2024.
The net profit margin has shown a similar pattern to the pretax margin, with negative figures in 2021 and a subsequent recovery in the following years. This indicates that Nordstrom Inc has managed to enhance its bottom-line performance and generate positive net income in 2023 and 2024, albeit at a relatively low margin compared to previous years.
Overall, Nordstrom Inc's profitability ratios suggest a complex and evolving financial performance, with fluctuations in margins reflecting changes in revenue, costs, and operational efficiency. The company may need to focus on cost management, revenue growth, and profitability improvement strategies to ensure long-term financial sustainability.
Return on investment
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 47.41% | 60.35% | 53.07% | 20.35% | 60.31% |
| Return on assets (ROA) | 1.59% | 2.80% | 2.01% | -7.23% | 5.09% |
| Return on total capital | 7.25% | 12.93% | 14.33% | -343.28% | 80.08% |
| Return on equity (ROE) | 15.80% | 33.15% | 30.64% | -226.23% | 50.66% |
Nordstrom Inc's profitability ratios reflect varying levels of success over the past five years.
- Operating return on assets (Operating ROA) has fluctuated, ranging from 20.35% in 2021 to a peak of 60.35% in 2023. The latest figure, 47.41% as of February 3, 2024, indicates a strong performance in generating operating income relative to the total assets employed.
- Return on assets (ROA) also shows variability, with a low of -7.23% in 2021 and a high of 5.09% in 2020. The current ROA of 1.59% suggests a moderate ability to generate profit from its total assets.
- Return on total capital has been positive in all years except for a significant negative result of -343.28% in 2021. The most recent figure of 7.25% as of February 3, 2024, indicates a modest return on the total capital invested in the company.
- Return on equity (ROE) has ranged from a low of -226.23% in 2021 to a high of 50.66% in 2020. The latest ROE of 15.80% as of February 3, 2024, reveals the company's ability to generate profit for its shareholders from their equity investment.
Overall, Nordstrom Inc's profitability ratios indicate a mix of strong and moderate performance in utilizing its assets and capital to generate income, suggesting the company has been effective in managing profitability over the years.