KeyBanc Capital Markets analyst Ashley Owens downgraded Nordstrom (NYSE: JWN) from Overweight to Sector Weight.
The analyst highlights several encouraging key priorities, including improvements in the Nordstrom banner, identification of operational efficiencies, and continued in Rack growth.
Sell-through during the second quarter's anniversary sale met expectations, while regular-price sales and increased customer visits reflect solid brand positioning.
With over 50% of revenue and approximately 60% of profit still ahead, the analyst notes that factors such as a more promotional holiday season and consumer pressures will influence performance.
Looking ahead, the analyst recognizes that the possibility of a go-private transaction could impact share price momentum.
On September 4, the Nordstrom Family and Liverpool submitted a proposal to acquire the company for $23 per share in cash.
The analyst notes the current valuation is fair, noting that the proposed price offers limited upside compared to the previous target of around $24. While the analyst maintains a positive outlook on the firm's strategic priorities for 2024, uncertainty surrounding the proposed transaction could weigh on potential stock price gains.