Nordstrom Inc. (JWN): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report

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Summary:
Nordstrom maintained its solid momentum by posting better-than-expected top- and bottom-line results, which also improved year over year. Both top and bottom lines benefited from the company's consistent store growth, flourishing customer strategy reflecting growth across channels, the Trunk Club acquisition and effective inventory and expense management. Moreover, we believe that the company's store expansion initiatives and entry into the Canadian market will boost its top-line in the long run. However, the company's projections for fiscal 2014 reflect higher costs across the board due to the ongoing investments, which will likely weigh on its margins. Moreover, we are cautious about the company's growth prospects due to the soft economic recovery, intense competition and exposure to seasonal fluctuations. Hence, we retain our long-term Neutral recommendation on the stock.

Overview:

Nordstrom Inc. is a leading fashion specialty retailer in the U.S., offering high-quality apparel, shoes, cosmetics and accessories for men, women and kids. The company offers both branded and private-label merchandise, which are positioned in the upscale segment of the industry and targeted towards the aspiring middle class. The company has two segments: Retail and Credit Card. The Retail segment offers a selection of brand names and private-label merchandise. The segment includes Nordstrom branded full-line stores and website, off-price Nordstrom Rack stores and other retail channels including HauteLook and Jeffrey boutiques. The Credit Card segment operates Nordstrom private label and co-branded VISA credit cards.

As of Nov 19, 2014, the Seattle-based company operated a network of 293 stores located in 38 states, of which 118 are full-line stores in the U.S. and 1 in Canada, 167 are Nordstrom Racks, 2 Jeffrey boutiques, 1 clearance outlet and 4 Trunk Club stores.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



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