Nordstrom Inc (JWN)
Financial leverage ratio
| Feb 3, 2024 | Jan 28, 2023 | Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 8,444,000 | 8,745,000 | 8,869,000 | 9,538,000 | 9,737,000 |
| Total stockholders’ equity | US$ in thousands | 848,000 | 739,000 | 581,000 | 305,000 | 979,000 |
| Financial leverage ratio | 9.96 | 11.83 | 15.27 | 31.27 | 9.95 |
February 3, 2024 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $8,444,000K ÷ $848,000K
= 9.96
The financial leverage ratio of Nordstrom Inc has fluctuated over the past five years, ranging from 9.95 in fiscal year 2020 to 31.27 in fiscal year 2021, before decreasing to 15.27 in fiscal year 2022, and further declining to 11.83 in fiscal year 2023, and reaching 9.96 in fiscal year 2024.
A high financial leverage ratio indicates a higher level of debt relative to equity, which can amplify returns but also increase financial risk. The significant spike in the financial leverage ratio in fiscal year 2021 may indicate a period of increased reliance on debt financing, potentially for strategic investments or operational necessities. The subsequent decrease in the leverage ratio in the following years suggests a potential deleveraging effort or a shift towards a more balanced capital structure.
Overall, Nordstrom Inc's financial leverage ratio trend indicates fluctuations in the company's capital structure and borrowing decisions. It is essential for stakeholders to monitor these changes to assess the firm's risk profile and financial health.
Peer comparison
Feb 3, 2024