Nordstrom Achieved Double Growth In The First Quarter

According to the world clothing shoes and hats net, the United States

Department store Nordstrom released the first quarter data on Thursday, although its comparable sales declined, but profit growth was in line with expectations and was better than other department stores.

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Comparable sales with the department stores also exceeded analysts' expectations.

This result has exacerbated the pessimism of retail investors, especially the department stores.

Nordstrom shares fell to $42.95 per share and slipped 7.6% earlier in regular trading.

By the end of Thursday, the company's stock price has fallen 3.6% this year, while the standard & Poor's 500 index has risen 7%.

As of April 29th, the core data of Nordstrom in the first quarter were as follows:

Net profit increased 37% to 63 million US dollars from the same period last year's 46 million US dollars.

Pre tax profit (EBIT) was US $151 million, accounting for 4.6% of net sales, compared with $106 million last year.

Total sales increased 2.7% from last year's 3 billion 200 million US dollars to US $3 billion 300 million.

Comparable store sales fell by 0.8% over the same period last year. Analysts had predicted that the data would remain unchanged.

Diluted earnings per share of 37 cents (including interest expense $18 million and first quarter debt refinancing $650 million related expenses, which is not within the company's expectations); diluted earnings per share for the same period last year were 26 cents (including non-profit expenses of $30 million, mainly due to changes in the industry liability rules that brought higher credit fees).

Excluding the non-profit cost of $30 million in 2016 and $18 million in debt refinancing in 2017, the first quarter diluted earnings per share grew by 19% over the same period last year.

Online sales accounted for 24% of total sales, of which nordstrom.com official website grew 11% year-on-year, and discount network nordstromrack.com/HauteLook grew 19% over the same period last year.

The full price product of the whole product line store and official website can be reduced by 2.3% compared with that of the official website, while analysts forecast a 1% year-on-year decline.

The comparable store sales of discount stores Nordstrom Rack also fell by 0.9% over the same period last year. Analysts had predicted that they should remain unchanged from the same period last year.

The best selling category is

The best performing region in the United States is the western market.

2014 ~2017, the growth of comparable sales per quarter Nordstrom

After the announcement of the earnings report, the company reiterated its annual profit forecast:

Diluted earnings per share of US $2.75 US $~3;

Net sales increased by 3~4% compared with the same period last year.

Nordstrom believes that by increasing exclusive brands (such as: J.Crew, Madewell and Topshop), winning the millennial interest has been successful.

Nordstrom also discussed the future cooperation with men's fashion e-commerce Bonobos.

According to insiders, the US retail giant Wal-Mart Store Inc is currently seeking to buy Bonobos at a price of $300 million (see related reports: the founder of the Internet menswear brand Bonobos has changed the way men buy clothes by selling pants).

Norstrom joint CEO Erik Nordstrom said Nordstrom will continue to cooperate with Bonobos in the future.

In addition, Nordstrom has also maintained good cooperation with WAL-MART's fashion e-commerce Jet.com.

After Thursday's announcement, analysts at Credit Suisse (He Ruiyin) said they were optimistic about Nordstrom's share price performance.

Credit Suisse analysts believe that the company is currently a leader in the US Department store industry.

Christian Buss, an analyst at Credit Suisse, said that Nordstrom's online business was eye-catching (accounting for 24% of sales, double-digit growth), and discount stores Nordstrom Rack (30% of sales, up 2.3% over the same period last year), which made up for the continued weakness of all product line stores (53% of sales and 2.8% year-on-year decline).

Michael Binetti, an analyst at UBS, believes that Nordstrom can still maintain strong growth in a weak environment, and that the sale of Nordstrom shares on Thursday is an "overreaction".

Although Nordstrom's comparable store sales are slightly lower than expected, the company has shown excellent performance in inventory control.

Subsequently, Credit Suisse set the target share price of Nordstrom to $52 per share, and UBS expects $51 per share, which is higher than Nordstrom's current stock price of $41.20 per share.

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J.C.Penney

On Friday, Nordstrom's J.C.Penney department store also released the first quarter data. Comparable sales were much lower than expected. It became one of the traditional department stores with declining retail sales as well as Messi stores and KONEs.

After the announcement, J.C.Penney's share price plummeted to near the lowest level in history.

As of April 29th, the core data of J.C.Penney in the first quarter were as follows:

Net sales fell for the third consecutive quarter, down 3.7% to 2 billion 710 million US dollars, down from 2 billion 770 million US analysts previously predicted by Thomson Reuters.

Stores that opened for more than a year were down 3.5% compared to the same period last year, or down by 0.7% compared with the previous year's Consensus Metrix forecast.

The net loss of J.C.Penney reached US $180 million, more than double the growth rate, and there were some negative effects on customs and severance expenses.

The common problems faced by these declining department stores are: the decline of physical stores, the strong competition of electricity providers and the decline of clothing demand.

In addition, the exceptionally warm climate in the United States in February and the delayed tax rebate in the first quarter of 2~4 also restricted consumer shopping enthusiasm.

However, the weakness of traditional retailers does not represent a decline in consumer spending.

According to the data released by the Ministry of Commerce on Friday, sales of clothing stores fell 0.5% in April, but online retailers, such as Amazon, grew by 1.4% year-on-year.

In response to the decline in demand, J.C.Penney said in February that it would follow Messi's department store to close 130~140's poorly performing stores and arrange about 6000 employees to retire early.

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