(JWN) Nordstrom Sketches New Store Plans

Following last week’s store opening plans, Seattle-based Nordstrom Inc. (JWN), is now looking forward to inaugurating two more Nordstrom Rack stores at different locations in the U.S. by fall of 2013. These new Rack stores will be located at The Mercato in Naples, Florida; and at the Perimeter Expo shopping center in Atlanta, Georgia.

Joining the company’s nine full-line and eight Rack stores in the state of Florida, the new Rack store will be located off the US-41, about two miles run from the Nordstrom full-line store at Waterside Shops. Housed in The Mercato, the two-level store will enclose about 30,000 square feet space in the property of Madison Marquette Retail Services. The store will occupy the space previously held by Borders book store. Other stores in the building include Whole Foods Markets Inc. (WFM), Ulta Salon, Cosmetics & Fragrance Inc. (ULTA), Sur La Table, Capital Grille and Blue Martini.

The Perimeter Expo shopping center store, spread over about 36,000 square feet, will be located just opposite the company’s full-line store at the Perimeter Mall. This store in the property of Kimco Realty Corp. (KIM) will be the company’s fourth Rack store in the greater Atlanta metropolitan area. Apart from this, the company has three full-line stores and one Jeffrey boutique in this area. The store is expected to come up in the space vacated by Best Buy Co. Inc. (BBY) and will share space with other leading brands including Marshall’s, Old Navy, Off Broadway and Thomasville Furniture.

Nordstrom’s Rack stores generally offer merchandise from Nordstrom stores and Nordstrom.com at a significantly reduced price to customers. Products at these stores are sold with discounts of roughly 50% to 60% from the original Nordstrom tags. Nordstrom Rack also carries a vast assortment of branded apparel, accessories and shoes that are available at Nordstrom stores, and are offered to customers at a discount of about 30% to 70%.

Nordstrom’s latest store openings signify the company’s commitment to strengthen its network with the aim of driving top-line growth. As of January 4, 2013, Nordstrom operated 240 stores, including 117 Nordstrom full-line stores, 119 Nordstrom Racks, 2 Jeffrey boutiques, 1 treasure&bond store and 1 clearance store.

The company has targeted to open 16 new stores in fiscal 2012 consisting of 1 full-line store and 15 Nordstrom Rack Stores. Additionally, the company has planned to add 24 new Rack stores in fiscal 2013 and intends to operate 230 Rack stores by the end of 2016.

Nordstrom currently maintains a Zacks Rank #3 (Hold). Moreover, our long-term recommendation on the stock remains Neutral.

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