We are starting to hear more and more which retailers did well in the holiday selling season and which did not. Kohl's (KSS 57.78, +0.74, +1.3%) and Target (TGT 70.26, +1.12, +1.6%), for instance, did very well. Express (EXPR 7.29, -0.08, -1.1%) did not. Fashion retailer Nordstrom (JWN 48.52, +0.63, +1.3%), meanwhile, held its own and issued some updated guidance after Tuesday's close that suggested as much.
Citing an improvement in its full-line and Nordstrom Rack stores relative to year-to-date sales trends, and growth in its e-commerce business, the Seattle-based retailer said its net sales increased 2.5% for the nine weeks ended December 30 while its comparable sales increased 1.2%.
The retailer's off-price Nordstrom Rack business led the way, registering an 8.2% increase in net sales and a 2.9% increase in comparable sales. The Nordstrom brand, which includes the full-line stores, Nordstrom.com, and the Trunk Club, saw a 0.7% increase in net sales and a 1.0% increase in comparable sales.
The growth at Nordstrom was more modest than the growth registered by Kohl's, which caters to a more value-oriented consumer, yet the salient point is that Nordstrom still delivered growth across its key brands in a very competitive environment.
Following the holiday selling activity, Nordstrom updated its fiscal 2017 outlook, which includes an expectation for net sales to increase approximately 4.2%, including the 53rd week, and earnings per diluted share to be in a range of $2.90 to $2.95. That outlook assumes stable merchandise margins and deleveraging from higher supply chain, technology, and occupancy expenses related to the company's growth initiatives.
When Nordstrom reported its fiscal third quarter results in early November, it was anticipating fiscal 2017 net sales to increase approximately 4% and earnings per diluted share to be between $2.85 and $2.95.
Notably, the updated earnings guidance does not account for the potential impact of tax reform.
On a related note, Nordstrom has been entertaining the notion of going private, but in October the company said it was going to suspend that pursuit until after the holiday selling season.
The question now is whether the retailer's performance in the holiday season was compelling enough to follow through on going private and getting a deal done at an acceptable price, and on acceptable terms, for shareholders.
Time will tell soon enough, but irrespective of any such developments, it is good to know Nordstrom had a better time of it during the holiday selling season than it had in the months leading up to that very important period for the retail industry.
Over the last 52 weeks, shares of JWN have risen 6.4%.