Yet Another Retailer Struggles With Consumer Spending
Nordstrom reported earnings this morning, and investors are punishing the stock now. Nordstrom's second quarter saw a lower-than-expected increase in revenue -- analysts were looking for a 6.8% bump, but the department store operator only delivered 4.4%.
Shares have fallen about 3% today as investors react to the report. While revenue disappointed some, guidance was of greater concern: The company lowered both its full-year sales and its profit forecasts. Other retailers have reported similar trends this earnings season, suggesting consumer spending has slowed. CFO Michael Koppel said, "We are in a business that tends to travel in cycles."
Motley Fool analyst Charly Travers is surprised to see Nordstrom suffering alongside lower-end retailers like Macy's and Kohl's, but thinks the stock remains a solid bet. Investors are only paying 15 times earnings for a company with great management, so this dip is likely to be temporary -- and might just be a good buying opportunity.
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The article Yet Another Retailer Struggles With Consumer Spending originally appeared on Fool.com.Charly Travers owns shares of Kohl's. Erin Kennedy has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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