UBS Raises price Target on Nordstrom (JWN) to $64 Following 3Q EPS Beat
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UBS reiterated a Buy rating on Nordstrom (NYSE: JWN), and raised the price target to $64.00 (from $58.00), following the company's 3Q earnings report. JWN reported EPS of $0.84, solidly ahead of the Street's estimate of $0.51. 3Q was a positive update with JWN finally generating SG&A leverage and with negative Consensus revisions likely diminishing. However, there are still concerns surrounding sluggish SSS trends.
Analyst Michael Binetti commented, "JWN reported 3Q EPS of $0.84 ($0.62 ex-tax benefit) vs our $0.48, Street: $0.51. Total company SSS increased +2.4% (UBSe: +3.5%, Street: +2.4%). Despite lower than expected comps, GM expanded +100bp (UBSe: -20bp) with solid inventory control (inventory +0.4% YOY vs sales +7.2%). Further, retail SG&A leveraged favorably -80bp (better than our estimate for 35bp of deleverage). Full-line store SSS were a concern at -4.5% (UBSe: +1%) implying a -1pp deceleration in the 2-yr stack despite a positive shift from the Anniversary Sale. Rack (+0.9% SSS) 2-yr stacked comps decelerated by -4pp vs 2Q. Nordstrom.com was strong at +20% (vs UBSe: +10% and +10% in 2Q)."
Shares of Nordstrom closed at $58.72 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst EPS View, Analyst PT Change
Related EntitiesUBS, Earnings
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