OREANDA-NEWS. Subpar performance of late has driven credit default swap (CDS) spreads on Nordstrom, Inc. out to their widest levels since 2012, according to Fitch Solutions in its latest CDS case study snapshot.

Five-year CDS on Nordstrom widened out 75% over the past week, underperforming the broader North America Retail sector, the CDS of which widened by 10%. The cost of credit protection on Nordstrom has increased, deviating from a 'A/A-' trading pattern observed for much of this year and now pricing in 'BBB' territory.

'Nordstrom's plunge in market sentiment is likely attributed to weaker than expected earnings and lowered outlook for the year,' said Director Diana Allmendinger.

Fitch Solutions case studies build on data from its CDS Pricing Service and proprietary quantitative models, including CDS Implied Ratings. These credit risk indicators are designed to provide real-time, market-based views of creditworthiness. As such, they can and often do reflect more short term market views on factors such as currencies, seasonal market effects and short-term technical influences. This is in contrast to Fitch Ratings' Issuer Default Ratings (IDRs), which are based on forward-looking fundamental credit analysis over an extended period of time.