Source: Company reports/Coresight Research

4Q17 Results

Nordstrom reported 4Q17 revenues of $4.70 billion, up 9.3% year over year and slightly above the $4.62 billion consensus estimate. Adjusted EPS was $1.20, missing the consensus estimate of $1.24. Comps increased by 2.6%, ahead of the consensus of 1.0%. The table below shows comps by business segment.

Source: Company reports

Merchandise inventories were $2.03 billion, up 6.9%, versus 9.3% sales growth during the quarter.

FY17 Results

EPS for the year including a $0.31 charge was $2.59, which was below the company’s prior outlook of $2.90–$2.95. Net sales were up 4.4% and comps were up 0.8%, both exceeding the company’s expectations. During FY17, Nordstrom experienced significant growth in its customer base and loyalty program. Customer numbers were up 4%, to 33 million. The company’s off-price business, Nordstrom Rack, gained 6 million new customers, one-third of which are expected to cross-shop the full-price business over time.

Outlook

Nordstrom provided the following FY18 guidance:

• Net sales of$15.2–$15.4 billion, versus the consensus estimate of $15.6 billion.
• Comparable sales growth of 0.5%–1.5%.
• EBIT of $885–$940 million.
• EPS of $3.30–$3.55, versus the consensus estimate of $3.29.