The Ten Best American Companies Part 3: Nordstrom, Inc. (JWN), The Clorox Company (CLX)

Page 1 of 2

So here it is – my final three American companies (in no particular order). We discussed Colgate-Palmolive Company (NYSE:CL), Google Inc (NASDAQ:GOOG), and Costco Wholesale Corporation (NASDAQ:COST) in my first post. My second post talked about my belief in Coach, Inc. (NYSE:COH), Under Armour Inc (NYSE:UA), Whole Foods Market, Inc. (NASDAQ:WFM), and PepsiCo, Inc. (NYSE:PEP). This post will show why coffee shops, clothing stores, and cleaning supplies should be in your portfolio, but hopefully they aren’t needed in the same day throughout your life.

When a guy says, “I have nothing to wear,” he really means, “I need to do laundry.” When a woman says, “I have nothing to wear,” she really means, “I want to go shopping.” So, she goes shopping. We will call this woman Susan.

Susan decided to go to Nordstrom, Inc. (NYSE:JWN) for a quick shopping spree. She was preparing for the unusually early Easter this year, and bought a nice colorful dress. She may not have realized the effect this purchase will have on the three companies I will discuss here.

Nordstrom, Inc. (NYSE:JWN) has a market cap of $10.8 billion dollars, with a respectable Free Cash Flow (FCF) yield of 5.3%. While this doesn’t show a tremendous value, the company’s revenues have increased 82% in the past decade as it made approximately $10.8 billion in 2012. 2009 marked the only decrease in Earnings Per Share (EPS) over the past decade, as they have increased from $0.33 to $3.14 in 2012. Gross margins have grown from approximately 33% to over 39% over the same ten year period. Amazingly, Nordstrom, Inc. (NYSE:JWN)’s average employee earned $19 per hour, which is 60% more than the industry average.

After a stressful afternoon of decision making (shopping), Susan decided to splurge and grab a drink from her favorite coffee place, Starbucks Corporation (NASDAQ:SBUX) . She had just started to enjoy her Grande Latte when a bystander bumped her table and spilled her delicious drink all over her brand new dress. What a bummer. This is bound to happen at times, as there are currently 17,000 stores in 55 countries. Susan wondered what she could do about this disastrous occurrence.

Starbucks is a coffee shop’s model of success. They thrive in customer service and quality, yet many people wonder if their products are overpriced. I will leave that up to them – but I will look at some other figures. The company’s revenues have increased 326% in the past decade, while gross margins are at 56.3%. Starbucks’ Return on Equity (ROE) and Return on Invested Capital (ROIC) have both increased from 14.09 and 13.78, to 29.15 and 25.71, respectively. They have experienced a large drop, though this was in 2008. The company shows a market cap of nearly $42 billion and a FCF yield of only 3.4%.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

6 Ways to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

The Most Heartwarming and Inspirational Story Of This Halloween Season, It Will Make You Cry and Jump For Joy

10 Best Party Songs of All Time to Bring the House Down With

5 New World Order Conspiracy Theories that Will Strangle the World

The 10 Highest Rated Movies of 2014

The 10 Largest Container Shipping Companies in the World

The 10 Largest Armies in the World: Who Should We Be Afraid Of?

Best Warren Buffett Quotes on Money You Need to Hear

The 10 Highest Suicide Rates by Profession

The 20 Most Underrated Movies of All Time

The 10 Fastest Growing Companies in America

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!