Please ensure Javascript is enabled for purposes of website accessibility

Why Shares of Nordstrom Are Rising Today

By John Rosevear - Mar 13, 2020 at 11:02AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Investors are looking for bargains, and this might be one.

What happened

Shares of upscale retailer Nordstrom (JWN -2.78%) were rising on Friday morning, after investors waded in following one of the market's worst down days in years.

As of 10:45 a.m. EDT, Nordstrom's shares were up about 8.3% from Thursday's closing price.

So what

On the one hand, there are legitimate short-term reasons to be worried about Nordstrom. Like other retailers, it's nearly certain to face a steep decline in store traffic as measures to slow the spread of COVID-19 take hold in the U.S and Canada.  

A Nordstrom sign on the outside of a store.

Image source: Nordstrom.

There are already signs that the viral outbreak is keeping shoppers home. Morgan Stanley analyst Kimberly Greenberger said in a note on Wednesday that U.S. retail traffic fell 9.1% last week, while luxury retail traffic dropped 14.7%, as consumers reacted to increased news coverage of the coronavirus's spread. 

On the other hand, there are reasons for long-term-minded investors to wade back in after yesterday's steep decline. Nordstrom remains a well-run company with solid financials, good longer-term prospects, and a dividend yield (currently 7.4%) that has only become more attractive as its share price has fallen.

Now what 

The pandemic is likely to hit Nordstrom's sales, but maybe only for a quarter or two. The good news is that China -- where the pandemic seems to have started -- is already starting to get back to normal. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Nordstrom, Inc. Stock Quote
Nordstrom, Inc.
$20.28 (-2.78%) $0.58

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/07/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.