Nordstrom Earnings & Outlook: When Bad Is Good Enough (JWN)

Nordstrom Inc. (NYSE: JWN) reported terrible earnings.  Interestingly enough, the report from the high-end retailer  is looking “good enough” when you consider the state of many retailers.

Nordstrom earned $0.31 EPS, a drop of nearly two-thirds on a net earnings basis.  It revenue were down 8.5% to $2.30 billion.  First Call consensus estimates were $0.30 EPS and $2.28 billion in revenue.  Same store sales for the quarter were off by 15.8%.  Imagine the day that we say that is good news.

The guidance for 2009 is certainly not great.  But it is within the range of estimates and may actually be looking better than some peers.  Same-store Sales are expected to be down 10% to 15%, and the company is targeting $1.10 to $1.40 EPS  2009 based upon 219 million shares.  Other metrics seen for the year are a Gross Profit drop of 150 to 250 basis points, a cut in SGA of $100 to $175 million for 40 to 70 basis points, a finance increase of $55 to $60 million with an increase in interest expenses of $20 to $25 million increase; and it sees an effective tax rate of 39.4% to 39.7%.

What is interesting is that the Thomson Reuters (First Call) estimates for fiscal January 2010 are $1.22 EPS).  The $1.10 to $1.40 is right in line there.  Just keep in mind that the same consensus estimate was $1.54 less than 90 days ago.

Nordstrom closed down almost 5% at $11.33 today, but shares are up 12% at $12.70 in the after-hours session.

Jon C. Ogg
February 23, 2009