Anniversary sale boosts Nordstrom

The retailer extends its largest event of the year -- and the strategy pays off.

By Zacks.com Sep 4, 2012 11:51AM

Young woman clothes shopping copyright Image Source, Getty ImagesBy Zacks Equity Research

 

Leading fashion retailer Nordstrom (JWN) came up with outstanding comparable store sales (comps) for the four-week period ended Aug. 25.


Gaining largely from the shift in the timing of its largest sale event of the year -- the Anniversary Sale -- Nordstrom posted a fabulous 21% increase in comps. The event was carried out over eight days in August this year compared to only one day in 2011.


In July, the company reported a 0.9% increase in comps compared to the year-ago period. Together, July and August 2012 comps were up 8.4% from last year.


August comps at Nordstrom's two business segments -- Nordstrom full-line and Nordstrom Rack -- increased 24% and 7.1%, respectively, compared with the year-ago period. Total retail sales climbed 25.2% to $866 million from $691 million reported in August last year.


Year-to-date through Aug. 25, Nordstrom's total retail sales gained 12.1% to $6,319 million, driven by an 8% increase in comparable store sales. During the period, the company's comparable store sales at Nordstrom full-line and Nordstrom Rack segments increased 8.6% and 7.2%, respectively.


Peer performance

One of Nordstrom's competitors, Gap Inc. (GPS), registered a 9% rise in comparable store sales for the month of August, while net sales came in at $1.20 billion, up 9.1% compared with the prior-year period.


Store expansion plans

Nordstrom announced plans to open four new Nordstrom Rack stores in September. The stores will be in three different states, including one at Manchester Highlands in Manchester, Mo., one at Tysons Corner, Va., and two in California -- at the Carmel Mountain Plaza in San Diego and the Edinger Plaza in Huntington Beach.


Additionally, the company plans to relocate its Nordstrom Rack store at the Mall at the Source in Westbury, N.Y., to the nearby Gallery at Westbury Plaza.


As of Aug. 30, Nordstrom operated 117 Nordstrom full-line stores, 110 Nordstrom Rack, two Jeffrey boutiques, one treasure&bond store and one clearance store -- bringing the total count to 231.


Our recommendation

Based in Seattle, Wash., Nordstrom offers high-quality apparel, shoes, cosmetics and accessories for men, women and kids. The company carries both branded and private label merchandise, as well as a private label card, two Nordstrom VISA credit cards and debit cards for Nordstrom purchases.


Nordstrom maintains a Zacks No. 2 Rank, which translates into a "short-term buy" rating. Our long-term recommendation on the stock remains "neutral."


More from Zacks

Tags: GPSJWN
0Comments

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

116
116 rated 1
284
284 rated 2
461
461 rated 3
671
671 rated 4
628
628 rated 5
618
618 rated 6
615
615 rated 7
495
495 rated 8
347
347 rated 9
115
115 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
DYNDYNEGY Inc10
TAT&T Inc9
VZVERIZON COMMUNICATIONS9
EXCEXELON CORPORATION8
AAPLAPPLE Inc10
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.