Going Private Possible for Nordstrom
Even after the price bump from the news, the stock trades for less than we think it’s worth.
Nordstrom’s (JWN) share price soared after the June 8 announcement that the Nordstrom family is exploring the option of taking its namesake company private. Combined, the family owns just over 30% of the department store.
We are not surprised by this news, as we have held that narrow-moat Nordstrom is better positioned than its no-moat peers, with a better-sized and -located store base (353 stores at the end of the first quarter versus Macy’s (M) 668), exposure to the growing off-price sector (about 30% of revenue is driven by Nordstrom Rack), curated offerings that differentiate it from e-commerce competitors, and reputation for customer experience excellence.
Bridget Weishaar does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.