Nordstrom (JWN) raised its outlook for fiscal 2015, which ends January 30, 2016, backed by strong sales growth in the first half of 2015. The company’s investments in its e-commerce business, expansion of Rack stores, and entry into the Canadian market are helping to boost its top line.
Guidance for fiscal 2015
Nordstrom raised both its sales and earnings guidance for fiscal 2015. Including the impact of the sale of its credit card portfolio, Nordstrom expects its fiscal 2015 net sales to increase by 8.5% to 9.5% compared to the prior guidance of a 7%-to-9% increase. Same-store sales are now expected to grow by 3.5% to 4.5%, up from the prior outlook of a 2%-to-4% increase. The company also revised its margin outlook, which we discussed in Part 5 of this series.
Nordstrom’s outlook for diluted EPS (earnings per share) is now in the range $3.85 to $3.95 compared to the prior guidance of $3.65 to $3.80. Nordstrom makes up 0.1% of the portfolio holdings in the iShares Russell 1000 Growth ETF (IWF) and 1.1% of the SPDR S&P Retail ETF (XRT).
Off-price retailer TJX Companies (TJX) also raised its outlook for the comparable fiscal year, following strong performance in the second quarter. Macy’s (M) lowered its sales guidance for fiscal 2015, given the company’s weak sales in the first half of the year. Ross Stores (ROST) issued a cautious outlook for the second half, given the uncertainty in the retail sector and the macroeconomic environment.
Planned store openings for 3Q15
In 3Q15, Nordstrom plans to open three full-line stores, including its international store in Vancouver, Canada. The other two full-line stores will open in Minneapolis, Minnesota, and Milwaukee, Wisconsin. The company also plans to relocate a full-line store in Los Angeles, California, and to open 16 Nordstrom Rack stores.
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