Nordstrom, Inc. (JWN)

Something promising. I noticed on their site that hardly anything is on sale.

Surprisingly, business shirts I used to buy are full price.

I even found some high end shoes that were on sale in 2020 but full price now.

I also saw a pretty wide collection, which is nice to see.

One last bit. Their partnership with Fanatics is up and items are available except for the most popular teams for at least a couple weeks now. That could mean many good things but also supply chain difficulty to quickly replenish.

You can’t time the market, but one fact is certain. This reversal will end at some point. This stock traded in the mid $30s for most of the year… no pump, no hype. It traded just on fundamentals. Guess what, the fundamentals look better today than they have all year and it’s at a 52 week low. Society is on the brink of booming; relaxed and vaxxed. The fed WILL have to raise interest rates. Value and cyclicals are the place to be, in my opinion. Nordstrom wants to return cash to shareholders. Investment upgrades will come, when that happens the stock should spike. Today may be the cheapest we’ll see it for the rest of the year. I suspect the reversal will happen BEFORE the end of the year. Will you be in? Or, will you be left behind? 🎄🚂📈

November 30th, 2020 this stock was trading around $25.00.

Dec 10th 2020, it was trading in the $30s. Society was not even partially open then.

I just witnessed the busiest Black Friday I’ve seen in years. People are out and getting together for the holidays. Nordstrom also has more positive catalysts and it’s future looks more certain than ever, in my opinion.

On Tuesday Nov 23rd 2021, this was kicked down to the low $20s; due to an earnings miss; citing supply chain disruptions in the Rack division. The algorithm decided to annihilate it: stop losses were initiated, margins were called, and shorts covered.

Nordstrom does not stock excess inventory! Meaning they order it when they need it. During “normal times”, this is an extremely efficient supply chain business model and guarantees fresh inventory. Shipping delays and out of stocks have really hurt the business, but they are paying down debt and the business is nearly back to its 2019 form. The business is getting better.

As supply chain disruptions linger, management is initiating pack and hold. Meaning they are ordering excess inventory for the warehouses so they can account for shipping delays. They look locked and loaded for the holidays. They’ll probably do at least 4 billion this quarter and the stolen merchandise is just a drop in the 4 billion dollar pool of water. It will have virtually no effect on the bottom line. It’s just a headline. I believe in fundamentals and this looks like a screaming buy; especially since they say they are on the verge of returning cash to shareholders. No one can time the market, but returning cash to shareholders and credit upgrades appear to be in sight. Those sound like extremely positive catalysts. We should see lots of positive news in 2022. 📈

I repeat: This was the biggest, single day drop in the history of the business; as a publicly traded company.

Biggest drop in 49 years, according to market watch! The business is recovering from a pandemic AND supply chain disruptions. I think they are doing amazing, all things considered. You have to realize that they have a higher concentration of stores on the west coast than their peers, and the west coast was much slower to reopen. I think DDS only has 2 stores in California. 10% of Macy’s stores are in California, compared to Nordstrom’s 20%. 2022 will be an amazing year and I still say this is a $45.00 stock if the dividend is re-instated.

Time to start (nibbling) another small position? I had an order at $19.95 that wasn't filled today. I still believe this could reach the mid-teens to upper-teens and then trade sideways for several months, so JWN is definitely not a good stock for the impatient trader. So many issues though and with the impact of another virus lurking will the Omicron variant cause again a slash or demand for clothing, work clothing, shoes, and formal wear? Will this new strain hit the factories once again in Asia and cause a third wave of supply chain issues? I would guess yes, to some degree.

So much to fix, labor cost, poor Rack sales, low levels of inventory in their premium brands in key categories such as women’s shoes & apparel and a mixture of messy hodge-podge stock from a variety of seasons. This is going to be a slow process, settle in. Keep some powder dry, I probably won’t be buying much in the way of stocks for the next week or so until we get some pertinent virological data from the scientist…not from the TV pundits or politicians. Good luck & great investing!