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Off-price retailers are significantly outperforming department stores in sales and profitability, capturing 59.5% of total sales and 76.6% of profits, according to UBS. The firm rates TJX Companies and Burlington Stores as Buys, while maintaining Sell ratings on Macy’s, Dillard’s, and Kohl’s due to weaker growth prospects. Despite a valuation premium, UBS expects off-price retailers to continue their strong performance and gain market share.
Off-price retailers are significantly outperforming department stores in both sales and profitability, capturing 59.5% of total sales and 76.6% of profits, according to UBS. The firm maintains Buy ratings for TJX Companies and Burlington Stores, while remaining bearish on department stores like Macy’s and Kohl’s due to weaker growth prospects. Despite higher valuations for off-price stocks, UBS expects their strong fundamentals to sustain this trend.
UBS has upgraded Abercrombie & Fitch, Burlington Stores, Boot Barn, and Gildan Activewear to Buy, citing strong growth potential and attractive valuations in the Softlines sector for 2025. The firm anticipates that U.S. tax cuts and deregulation will boost apparel spending, while concerns over tariffs are downplayed. Additionally, Gap and Nordstrom have been upgraded to Neutral, with Gap's CEO recognized for driving change.
UBS has upgraded Abercrombie & Fitch, Burlington Stores, Boot Barn, and Gildan Activewear to Buy, citing strong growth potential and attractive valuations. The firm anticipates that U.S. tax cuts and deregulation will significantly boost apparel spending, while concerns over tariffs are deemed minimal. Additionally, Gap and Nordstrom were upgraded to Neutral, with Gap's CEO recognized for his effective leadership.
DekaBank Deutsche Girozentrale increased its stake in Nordstrom by 70.5%, now holding 5,387 shares valued at $112,000. Analysts have mixed ratings on the stock, with UBS upgrading it to "neutral" and a consensus price target of $21.92. Nordstrom reported a quarterly EPS of $0.33, surpassing estimates, with revenue up 4.6% year-over-year.
Retailers are increasingly adopting smaller store formats to adapt to changing consumer preferences and optimize revenue per square foot. Chains like Macy’s, Target, and Ikea are experimenting with mini-stores, offering personalized experiences while catering to urban shoppers. This shift reflects a broader trend where convenience and accessibility are prioritized, as consumers seek tailored shopping experiences in both physical and online environments.
As the holiday shopping season approaches, retailers face a stark divide in performance, with Target, Kohl’s, and Best Buy reporting disappointing results, while Walmart and Abercrombie & Fitch thrive. Consumers are increasingly selective, prioritizing value and practical gifts, leading to cautious spending amid ongoing inflation. Despite a projected increase in holiday spending, retailers are bracing for challenges, with some already adjusting forecasts downward.
UBS analyst Jay Sole has raised Nordstrom's price target to $14.50 from $13 while maintaining a Sell rating. The retailer is expected to struggle against off-price competitors and direct-to-consumer brands, leading to potential share losses and downward revisions in earnings per share over the coming years.
Nordstrom, Inc. is a fashion retailer offering private label merchandise across various categories, including apparel, footwear, and home goods. The company operates through two segments: Nordstrom, which includes its online and physical stores, and Nordstrom Rack, which serves as an outlet for clearance items. Both segments facilitate online order pickups and returns, enhancing the shopping experience for digital customers.
UBS analyst Jay Sole has raised Nordstrom's price target to $14.50 from $13 while maintaining a Sell rating. The firm anticipates ongoing challenges for Nordstrom against off-price retailers and direct-to-consumer brands, which may lead to further share losses and downward EPS revisions in the coming years.
Nordstrom, Inc.
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The information provided herein is generated by experimental artificial intelligence and is for informational purposes only.
off-price retailers outperform department stores in sales and profitability trends
United States Dollar
Macy's, Inc.
Kohl's Corp
Burlington Stores, Inc.
Dillard's, Inc.
Nordstrom, Inc.
Ross Stores, Inc.
TJX Companies Inc
USA
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20:04 31.03.2025
off-price retailers outperform department stores in sales and profitability trends
Macy's, Inc.
Kohl's Corp
Burlington Stores, Inc.
Dillard's, Inc.
Nordstrom, Inc.
Ross Stores, Inc.
TJX Companies Inc
USA
Show more
19:37 31.03.2025
UBS upgrades retail stocks signaling optimism for softlines sector in 2025
United States Dollar
Boot Barn Holdings, Inc.
Burlington Stores, Inc.
GAPACK
Abercrombie & Fitch Co.
Nordstrom, Inc.
Gildan Activewear Inc.
USA
Richard Dickson
Donald Trump
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18:58 10.01.2025
ubs upgrades retail stocks signaling growth potential in softlines sector
United States Dollar
Boot Barn Holdings, Inc.
Burlington Stores, Inc.
GAPACK
Abercrombie & Fitch Co.
Nordstrom, Inc.
Gildan Activewear Inc.
USA
Richard Dickson
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18:36 10.01.2025
DekaBank increases Nordstrom stake as analysts adjust ratings and price targets
14:14 10.01.2025
retailers embrace smaller store formats to enhance customer experience and revenue
United States Dollar
Macy's, Inc.
Ikea
Walmart Inc.
Target Corporation
Nordstrom, Inc.
USA
Michael Zakkour
Roger Mcmahon
Mary Rhodes
Barbara Snedegar
Show more
16:15 30.11.2024
retailers face challenges as holiday shopping season begins with mixed results
United States Dollar
Target Corporation
Kohl's Corp
MACYS
Walmart Inc.
Abercrombie & Fitch Co.
Nordstrom, Inc.
USA
Rick Gomez
Scott Lipesky
Erik Nordstrom
John David Rainey
Marshal Cohen
Gabrielle Fonrouge
Show more
13:30 29.11.2024
ubs raises nordstrom price target amid ongoing retail challenges
13:10 28.11.2024
ubs maintains sell rating on nordstrom amid retail challenges
18:27 27.11.2024
UBS raises Nordstrom price target amid ongoing retail challenges
13:10 27.11.2024
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