UBS Maintains Buy On Nordstrom Ahead Of Quarter 4 Earnings

On Wednesday, UBS issued a report on Nordstrom, Inc.

ahead of the company's Q4 earnings announcement on Thursday, February 18th. Analysts at UBS maintained their Buy rating and lowered their price target from $63 to $58. Michael Binetti and Kaitlyn Walsh, analysts at UBS, wrote, "We believe tourism, and sluggish spending trends from high-income customers could result in slower revenue guidance than JWN likely anticipated when they committed to an accelerating EPS growth rate...we expect conservative initial ‘16 targets until top line trends improve." Analysts at UBS gave a key reason why Nordstrom is well positioned to grow in the future: 1. Visible growth drivers UBS believes that Nordstrom has significant opportunities to grow top line revenue with increased exposure in Canada and New York City. Furthermore, analysts expect ongoing 3-5 percent square foot growth per year over the next 3 years. 2. Investments Analysts at UBS noted that Nordstrom has invested heavily in recent years to bolster the long-term top line growth rate, particularly in initiatives such as HauteLook and Trunk Club. Both of these have the potential to drive profitability in the highly competitive retail market. UBS lowered their 4Q15 EPS to $1.25 from $1.35. Nordstrom, Inc is currently trading at $51.80, up 1.77 percent.