Macy's vs Nordstrom Which Performs Better?

Macy's and Nordstrom are two leading retailers in the fashion industry, both vying for investor attention. Macy's, a household name with a long history in the retail sector, has faced challenges in recent years due to changing consumer preferences and the rise of e-commerce. On the other hand, Nordstrom has carved out a niche as a high-end department store known for its exceptional customer service and curated selection of luxury brands. Investors are closely monitoring both stocks to see which retailer will come out on top in the evolving retail landscape.

Macy's or Nordstrom?

When comparing Macy's and Nordstrom, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Macy's and Nordstrom.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Macy's has a dividend yield of 4.2%, while Nordstrom has a dividend yield of 3.28%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Macy's reports a 5-year dividend growth of -15.21% year and a payout ratio of 112.43%. On the other hand, Nordstrom reports a 5-year dividend growth of -12.48% year and a payout ratio of 35.23%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Macy's P/E ratio at 27.28 and Nordstrom's P/E ratio at 10.80. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Macy's P/B ratio is 0.27 while Nordstrom's P/B ratio is 3.85.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Macy's has seen a 5-year revenue growth of 0.04%, while Nordstrom's is -0.04%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Macy's's ROE at 2.26% and Nordstrom's ROE at 38.91%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $16.18 for Macy's and $22.45 for Nordstrom. Over the past year, Macy's's prices ranged from $14.06 to $22.10, with a yearly change of 57.18%. Nordstrom's prices fluctuated between $16.63 and $24.99, with a yearly change of 50.27%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.