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Deutsche Bank Boosts Estimates on Nordstrom (JWN), Cuts Kohl's (KSS) and Fred's (FRED)

January 3, 2013 3:55 PM EST Send to a Friend
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Price: $60.84 --0%

Rating Summary:
    12 Buy, 13 Hold, 1 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
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Deutsche Bank adjusted estimates on Nordstrom (NYSE: JWN) higher and Kohl's Corp. (NYSE: KSS) and Fred's, Inc. (NASDAQ: FRED) lower following December comps.

On Nordstrom, they raised EPS to $1.34 from $1.31 previously. FY12 EPS increases to $3.49 from $3.46 and FY13 EPS forecast remains at $4.00, representing ~15% earnings growth next year. The firm maintains a Buy rating and PT of $60.

On Kohl's, the firm lowered 4Q12 and FY13 EPS by 10% and 18%, respectively, as the company's build up of inventory in an increasingly promotional environment was likely to lead to lower out the door prices and negatively impact margins. "Assuming +6.0% comps in Jan. (clearance month) we arrive at 4Q SSS of +0.8% and GPM down 298 bps YOY (versus original guidance for down 80-100 bps) to 4Q12 EPS of $1.62 (from $1.89). For FY13, we assume continued top-line and merchandise margin pressure and are cutting our estimate further to $4.00 (from $4.25) based on a 0.5% comp decline, a 72 bps GPM drop to 35.5%, and flattish expense $ growth." The firm lowered their price target from $45 to $40, while maintaining a Hold.

On Fred, the firm lowered Q4 EPS estimates to $0.25 (from $0.30) due to expectations that January (historically a tough month for FRED) will remain challenging (Jan SSS est. = -2.0%). FY12 and FY13 EPS now stand at $0.87 (from $0.93) and $0.95 (from $1.02), respectively. The firm maintained a Sell rating and $10 price target.

For an analyst ratings summary and ratings history on Nordstrom click here. For more ratings news on Nordstrom click here.

Shares of Nordstrom closed at $53.63 yesterday.




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