Nordstrom Store Count Keeps Ticking With New Colorado Outlet

With store expansion efforts on track, Nordstrom, Inc. (NYSE:JWN) recently announced plans to inaugurate a Nordstrom Rack store at the Orchard Town Center in Westminster, CO, in spring 2019. Spanning across 25,000 square feet, the new store marks the seventh Rack store in the state.

This new outlet will share space with various restaurants and specialty shops as well as renowned retailers, including Macy's, Inc. (NYSE:M) , Target Corporation (NYSE:TGT) , AMC Theatres, H&M, REI and Gap Inc.’s (NYSE:GPS) Old Navy.

Situated off I-25 in the northern Denver metro area, The Orchard Town Center is an open-air retail and entertainment platform, which is owned and supervised by Phoenix-based Vestar. Nordstrom is likely to gain from this convenient location and better cater to its customers by its top-tier merchandise offerings.

Being the off-price retail segment of the company, Nordstrom Rack offers fashion-savvy customers a wide range of on-trend apparel, footwear and other accessories at discounted prices. These Racks usually keep items from the main Nordstrom stores as well as online store, Nordstrom.com. Also, these stores stack products from other major brands sold by the company.

Notably, the company has three full-line stores in the state of Colorado, alongside six Rack outlets. In fiscal 2017, management intends to introduce 11 Rack stores, and will relocate one store. In addition, the company is on track with domestic store expansion. It is scheduled to inaugurate two full-line store relocations in California in October, at Westfield Century City in Los Angeles and at University Towne Center in La Jolla.

As of Aug 18, 2017, the company operates 354 outlets across 40 states. Its portfolio also includes 122 full-line stores across the United States, Puerto Rico and Canada, two Jeffrey boutiques, 221 Nordstrom Racks and two clearance stores.

Prior to this Westminster store, the company announced plans to introduce a Rack store at The Promenade at Town Center in Santa Clarita, CA, which is slated to open doors in spring 2018.

Interestingly, with digital transformation in shopping and consumers splurging online, store and mall traffic has been hit hard. As a result, most retailers, including the big-box ones, are struggling to compete with eCommerce bigwigs and are being forced to curb their store count to focus more on an online model.

On the contrary, Nordstrom is a resilient company that continues with its store expansion plans despite a challenging retail backdrop.

Furthermore, we laud the company’s cost-saving initiatives and progress on 2020 strategy. Though its growth strategy bodes well, investments toward occupancy, technology, supply chain and marketing are likely to weigh upon its near-term cost and margin performance.

However, its strategic efforts are well reflected in the stock performance. This Zacks Rank #3 (Hold) stock gained 4.4% in the last three months against the industry’s decline of 16.9%.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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