Leading fashion retailer, Nordstrom Inc. (JWN - Analyst Report), came up with outstanding comparable store sales (comps) for the four-week period ended August 25, 2012. Gaining largely from the shift in the timing of its largest sale event of the year – the Anniversary Sale – partly into August, Nordstrom posted a fabulous 21.0% increase in comps. The event was carried out over a period of 8 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 24.0% 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 August 25, 2012, Nordstrom’s total retail sales augmented 12.1% to $6,319 million driven by an 8.0% 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.
One of Nordstrom’s competitors, Gap Inc. (GPS - Analyst Report), 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 its plans of opening four new Nordstrom Rack stores in September. The plans include opening of stores in three different states including one store at Manchester Highlands in Manchester, Missouri; one at Tysons Corner, Virginia; and two stores in California located at the Carmel Mountain Plaza in San Diego and Edinger Plaza in Huntington Beach.
Additionally, the company plans to relocate its Nordstrom Rack store at the Mall at the Source in Long Island, New York to the nearby Gallery at Westbury Plaza.
As of August 30, 2012, Nordstrom operated 117 Nordstrom full-line stores, 110 Nordstrom Rack, 2 Jeffrey boutiques, 1 treasure&bond store and 1 clearance store, thus bringing the total store count to 231.
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 maintains a Zacks #2 Rank, which translates into a short-term Buy rating. Our long-term recommendation on the stock remains Neutral.