Nordstrom Inc. is a fashion specialty retailer specializing in apparel, shoes, cosmetics, and accessories for men, women, and children in the United States and Canada. The company was founded in 1901 and is based in Seattle, Washington.
JWN Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Nordstrom Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Nordstrom Inc ranked in the 54th percentile in terms of potential gain offered. More precisely, our analysis suggests the stock is undervalued by approximately 86.17% on a DCF basis. In terms of the factors that were most noteworthy in this DCF analysis for JWN, they are:
In the past 5.55 years, Nordstrom Inc has a compound free cash flow growth rate of -0.05%; that's higher than just 22.89% of free cash flow generating stocks in the Consumer Cyclical sector.
30% of the company's capital comes from equity, which is greater than only 19.13% of stocks in our cash flow based forecasting set.
Nordstrom Inc's weighted average cost of capital (WACC) is 5%; for context, that number is higher than only 1.97% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
BC, TSG, BBX, CWH, and QNST can be thought of as valuation peers to JWN, in the sense that they are in the Consumer Cyclical sector and have a similar price forecast based on DCF valuation.