Despite the unexpected departure of CFO Anne Bramman, Jefferies analyst Ashley Helgans remains optimistic on prospects for Nordstrom ( NYSE: JWN ) heading into 2023.
Helgans acknowledged that the departure of the CFO was a surprise for her, though she pointed to a reaffirmed full-year guide as the key piece of encouraging news in the press release. The guidance remains unchanged from August, forecasting 5% to 7% revenue growth, $2.30 to $2.60 in earnings per share, and adjusted EBIT margin in the range of 4.3% to 4.7%.
“Although we see the potential for dept store sales to face headwinds next year in the event of an economic recession, we believe JWN's exposure to a higher-income consumer would help it
hold up relatively well, especially if the high-end consumer remains more insulated from inflation
and consumption declines are more shallow in nature,” Helgans told clients on Tuesday. “Additionally, promos are expected to be elevated in the 2H, which could continue into next year as well and return to '19 levels per mgmt. However, JWN promotes less than peer and expects to exit the year in a clean inventory position, which should mitigate promos next year and help the co. focus on offering an assortment with better newness.”
To be sure, she clarified that luxury spending may be augmented if asset prices fail to hold up.
Shares of the Seattle-based retailer rose 2.03% in premarket trading on Tuesday, adding to an over 6% gain on Monday.
Read more on recent executive departures aside from the CFO .
For further details see:
Nordstrom is better insulated from macro pressure than peers - Jefferies