One of the leading fashion specialty retailers in the United States, Nordstrom Inc. (JWN), once again reported a robust growth in its comparable store sales for the five-week period ended December 31, 2011. The December results marked the 27th consecutive month of comparable store sales growth.
The company’s December same-store sales grew by 8.7% compared with 8.4% in the five-week period ended January 1, 2011. Total retail sales climbed 12.7% to $1.57 billion from $1.39 billion for the five-week period ended January 1, 2011.
The company has been able to attract customers by offering free online shipping, improved services and access to Wi-Fi at its full-line stores. Adding to the delight, shoppers visited Nordstrom’s stores quite frequently due to discount offers on limited inventory of designer merchandise.
Fourth-quarter 2011 – to-date sales
The company’s comparable sales for the period (starting from fourth-quarter – till date) increased 7.5% from the prior-year quarter. Total retail sales during the period surged 12.3% to $2.48 billion compared with a total retail sales of $2.21 billion in the prior-year quarter.
Year-to-date Sales
Moreover, Nordstrom’s year-to-date comparable sales grew by 7.3% year over year. Total retail sales for the period increased 12.7% to $9.81 billion from $8.70 billion reported in the prior-year period.
As of December 31, 2011, Nordstrom had 117 Nordstrom full-line stores, 104 Nordstrom Racks, 2 Jeffrey boutiques, 1 treasure&bond store and 1 clearance store. Same-store sales at Nordstrom stores (including Nordstrom full-line stores and Direct) increased 11% in December, while Nordstrom Rack reported a rise of 0.7% for the five-week period ended December 31, 2011. Quarter-to-date, the company’s same-store-sales increased 9% at Nordstrom Stores and 2.5% at Nordstrom Rack. Year to date, the company reported an increase of 8.3% in same-store sales at Nordstrom stores and a rise of 3.9% at Nordstrom Rack.
Peer Performance
One ofNordstrom’s competitors,Gap Inc.‘s (GPS) registered a decline of 4% in same-store sales in December 2011, while its net sales came in at $1.98 billion compared with $2.01 billion in the year-ago period.
Conclusion
Nordstrom remains focused on expanding its store network to drive top-line growth. However, a sluggish discretionary spending environment, intense competition and exposure to seasonal fluctuations will keep us on the sidelines.
Based in Seattle, Washington, 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, as well as a private label card, two Nordstrom VISA credit cards and debit cards for Nordstrom purchases.
Nordstrom’s shares maintain a Zacks #3 Rank, which translates into a short-term ‘Hold’ rating. Our long-term recommendation on the stock remains ‘Neutral’.
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