Nordstrom Inc (JWN)

The solvency ratios of Nordstrom Inc provide insights into the company's ability to meet its financial obligations and manage debt effectively.

1. Debt-to-assets ratio:
- Nordstrom's debt-to-assets ratio declined from 0.33 in January 28, 2023, to 0.00 by January 31, 2024, before increasing slightly to 0.31 by February 3, 2024, and then returning to 0.00 by January 31, 2025.
- A decreasing trend in the debt-to-assets ratio signifies a lower reliance on debt to finance assets, which is positive for the company's financial health.

2. Debt-to-capital ratio:
- Similarly, the debt-to-capital ratio of Nordstrom decreased from 0.79 in January 28, 2023, to 0.00 by January 31, 2024, rose to 0.75 by February 3, 2024, and then returned to 0.00 by January 31, 2025.
- A lower debt-to-capital ratio indicates that the company is financing its operations more through equity capital than debt, which is typically viewed favorably by investors.

3. Debt-to-equity ratio:
- Nordstrom's debt-to-equity ratio dropped significantly from 3.86 in January 28, 2023, to 0.00 by January 31, 2024, increased to 3.08 by February 3, 2024, and then returned to 0.00 by January 31, 2025.
- A declining trend in the debt-to-equity ratio shows a reduction in financial risk and indicates that the company is relying less on debt financing relative to equity.

4. Financial leverage ratio:
- The financial leverage ratio of Nordstrom decreased gradually from 11.83 in January 28, 2023, to 7.86 by January 31, 2025.
- A declining financial leverage ratio suggests that the company is becoming less leveraged over time and may have improved its overall financial stability.

In summary, Nordstrom Inc has shown a positive trend in its solvency ratios, indicating a prudent management of debt and a stronger financial position over the periods analyzed.

---

Coverage ratios

The interest coverage ratio for Nordstrom Inc shows a varying trend over the past few years. In January 2023, the interest coverage ratio was at 3.63, indicating that the company was generating sufficient operating income to cover its interest expenses. This ratio improved slightly to 3.71 by January 2023, further reinforcing Nordstrom's ability to meet its interest obligations comfortably.

However, there was a noticeable decline in the interest coverage ratio to 2.07 by January 2024, which may raise concerns about the company's ability to service its debt obligations. Despite this decline, Nordstrom managed to improve its interest coverage to 2.41 by February 2024, showing some progress in addressing its interest payment obligations.

By January 2025, Nordstrom's interest coverage ratio increased significantly to 4.85, indicating a strong ability to cover its interest expenses with operating income. Overall, while there have been fluctuations in Nordstrom's interest coverage ratio over the years, the company's recent ratio suggests a healthier financial position in terms of meeting its interest payments.