Nordstrom Inc (JWN)
Return on total capital
| 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 251,000 | 222,000 | 123,000 | 133,000 | 465,000 | 577,000 | 701,000 | 650,000 | 492,000 | 223,000 | 202,000 | -319,000 | -1,047,000 | -777,000 | -690,000 | -104,000 | 786,000 | 819,000 | 731,000 | 761,000 |
| Long-term debt | US$ in thousands | 2,612,000 | 2,611,000 | 2,609,000 | 2,608,000 | 2,856,000 | 2,855,000 | 2,853,000 | 2,854,000 | 2,853,000 | 2,851,000 | — | — | — | — | — | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 848,000 | 729,000 | 674,000 | 551,000 | 739,000 | 606,000 | 663,000 | 589,000 | 581,000 | 359,000 | 268,000 | 166,000 | 305,000 | 252,000 | 174,000 | 397,000 | 979,000 | 851,000 | 759,000 | 651,000 |
| Return on total capital | 7.25% | 6.65% | 3.75% | 4.21% | 12.93% | 16.67% | 19.94% | 18.88% | 14.33% | 6.95% | 75.37% | -192.17% | -343.28% | -308.33% | -396.55% | -26.20% | 80.29% | 96.24% | 96.31% | 116.90% |
February 3, 2024 calculation
Return on total capital = EBIT (ttm) ÷ (Long-term debt + Total stockholders’ equity)
= $251,000K ÷ ($2,612,000K + $848,000K)
= 7.25%
Nordstrom Inc's return on total capital has shown fluctuations over the past several periods. The return on total capital ranged from negative values of -396.55% to a high of 116.90% during the period under review. Despite the variability in performance, the company managed to achieve positive returns in most periods, with the highest return recorded in the May 4, 2019, period.
The return on total capital is a key indicator of how effectively Nordstrom is utilizing its capital to generate profits. A consistent and positive return on total capital indicates efficient capital allocation and operational performance. However, the negative values observed in certain periods suggest potential inefficiencies in capital management or operational challenges that impacted profitability.
It is important for Nordstrom to analyze the factors contributing to the fluctuations in return on total capital to make informed business decisions and improve overall financial performance. Further analysis of the company's financial statements and operational strategies can provide valuable insights into enhancing future returns on total capital.
Peer comparison
Feb 3, 2024