Nordstrom Partners Bonobos - Analyst Blog

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In a move to supplement its e-commerce division, Nordstrom Inc . ( JWN ), one of the leading fashion specialty retailers in the U.S., has entered into a partnership with the largest online clothing brand Bonobos Inc.

E-commerce has emerged as the most successful tool for retailers to enhance sales as it enables the companies to generate additional revenues and broadens the existing customer base globally. Besides, it also improves the visibility and reputation of the retailer as a global firm offering great fashion and value at the same time.

Launched in 2007, Bonobos sells best-selling washed Chinos and colorful spring options, exclusively through online.  Following the announcement, Nordstrom stores will now feature the Bonobos assortments, while it will also sell Bonobos merchandise online through Nordstrom.com.


Based in Seattle, Washington, Nordstrom Inc. offers high quality apparel, shoes, cosmetics and accessories for men, women and kids. The company offers 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's comparable store sales grew 8.6% in March compared with the prior-year period. Comparable store sales of Nordstrom's business segments - Nordstrom full-line and Nordstrom Rack - increased 9.3% and 7.3%, respectively, compared with the year-ago period.

Total retail sales climbed 14.7% to $1,029 million from $897 million reported in March last year. As of March 31, 2012, Nordstrom operated 117 Nordstrom full-line stores, 109 Nordstrom Racks (including 2 Jeffrey boutiques, 1 treasure & bond store and 1 clearance store), thus bringing the total store count to 226.

Looking ahead, Nordstrom aims to open three more Nordstrom rack stores in April, one each at the West Farms Shopping Center in Farmington, Connecticut; Boise Town Plaza in Idaho and North Point Market Center in the city of Alpharetta, Georgia.

Quarter-to-date, Nordstrom's total retail sales climbed 15.3% to $1,733 million, primarily driven by a 9.2% increase in comparable store sales. During the period, the company's comparable sales at Nordstrom full-line stores registered a year-over-year growth of 10.4%, while at Nordstrom Rack stores, comparables sales grew 6.7%.

Our long-term recommendation on the stock remains 'Neutral'. Moreover, Nordstrom, which faces stiff competition from Gap Inc . ( GPS ), maintains a Zacks #3 Rank, which translates into a short-term 'Hold' rating.


 
GAP INC ( GPS ): Free Stock Analysis Report
 
NORDSTROM INC ( JWN ): Free Stock Analysis Report
 
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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.



This article appears in: Investing , Business , Stocks

Referenced Stocks: GPS , JWN

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