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Summary

  • Seven insiders sold Nordstrom stock within one month.
  • The stock was not purchased by any insiders in the month of intensive selling.
  • Six of these seven insiders decreased their holdings by more than 10%.

Nordstrom (NYSE:JWN) offers apparel, shoes, cosmetics, and accessories for women, men, and children in the United States.

(click to enlarge)

Insider selling during the last 30 days

Here is a table of Nordstrom's insider activity during the last 30 days.

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
Daniel LittleEVPMarch 24-2515,583Yes50,517 shares + 92,231 options9.8%
David WitmanEVPMarch 24-2513,824No15,765 shares46.7%
Michael KoppelEVPMarch 24-2537,126Yes75,092 shares33.1%
Delena SundayEVPMarch 1951,912No44,038 shares + 7,035 options50.4%
Geevy ThomasEVPMarch 1719,544No45,394 shares30.1%
Robert MiddlemasEVPMarch 410,000No18,393 shares35.2%
Tricia SmithEVPMarch 47,176No3,806 shares + 15,603 options27.0%

There have been 155,165 shares sold by insiders during the last 30 days. Daniel Little and Michael Koppel sold shares pursuant to a Rule 10b5-1 plan. More details about the Rule 10b5-1 trading plan can be found from this link.

Insider selling by calendar month

Here is a table of Nordstrom's insider activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
March 2014155,1650
February 201400
January 201400
December 201344,7100
November 2013114,6490
October 20136,4390
September 201339,2460
August 201300
July 2013129,2610
June 201349,6030
May 2013191,4940
April 201300
March 201324,9650
February 201300
January 201300

There have been 755,532 shares sold, and there have been zero shares purchased by insiders since January 2013.

Financials

Nordstrom reported the fiscal 2013 full-year, which ended February 1, results on February 20 with the following highlights:

Revenue$12.5 billion
Net income$734 million
Cash$1.2 billion
Debt$3.1 billion

The seven insiders sold their shares after these results.

(Source: Earnings presentation)

Outlook

Nordstrom's guidance is as follows:

Q1/2014FY2014
Total sales growth3.5%-5.5%5.5%-7.5%
Same-store sales growthN/A2%-4%
EPS$0.60-$0.70$3.75-$3.90
Capital expendituresN/A$840-$880 million

(Source: Earnings presentation)

Competition

Nordstrom's competitors include Dillard's (NYSE:DDS), Kohl's (NYSE:KSS), and Macy's (NYSE:M). Here is a table comparing these companies.

CompanyJWNDDSKSSM
Market Cap:11.72B3.95B11.78B21.31B
Employees:N/AN/A31,000N/A
Qtrly Rev Growth (yoy):0.00-0.04-0.04-0.02
Revenue:12.54B6.69B19.03B27.93B
Gross Margin:0.370.370.360.40
EBITDA:1.78B809.20M2.63B3.78B
Operating Margin:0.110.080.090.10
Net Income:734.00M323.70M889.00M1.49B
EPS:3.717.104.053.86
P/E:16.6512.6613.9515.13
PEG (5 yr expected):1.410.732.401.10
P/S:0.940.590.610.76

Nordstrom has the highest P/S ratio among these four companies.

Here is a table of these competitors' insider activities this year.

CompanyInsider buying / sharesInsider selling / shares
M01,264,860
KSS022,436
DDS05,000

Macy's has also seen intensive insider selling during the last 30 days.

Conclusion

There have been seven different insiders selling Nordstrom and there have not been any insiders buying Nordstrom during the last 30 days. Six of these seven insiders decreased their holdings by more than 10%. Nordstrom has an insider ownership of 9.70%.

Before going short Nordstrom, I would like to get a bearish confirmation from the Point & Figure chart. The two main reasons for the proposed short entry are a relatively high P/S ratio, and the intensive insider-selling activity.

Source: Nordstrom: 7 Different Insiders Have Sold Shares This Month