Sector Snap: Department stores fall

Shares of department stores dropped Thursday after retailers reported largely worse-then-expected same-store sales for June.

Shares of Nordstrom Inc. fell after the luxury department store said its same-store sales, or sales at stores open at least a year, dropped 18.6 percent, due largely to a shift in a sale for women and kids from June into May.

The decline matched the expectations of Wall Street analysts, according to a poll by Thomson Financial.

But the company also said its second-quarter profit would be either below or at the low end of its guidance for earnings of 65 cents to 70 cents per share.

Analysts expect profit of 67 cents per share.

Shares dropped $2.63, or 8.4 percent, to $28.61 in morning trading.

Saks Inc., another luxury department store, reported its same-store sales rose 1.9 percent, but analysts had expected a boost of 6.5 percent for the month. Saks blamed slow sales of women's and men's clothing for the sales drop.

Shares fell 21 cents, or 2.2 percent, to $9.56.

At J.C. Penney Co. Inc. same-store sales dropped 2.4 percent, missing analysts' expectations for a decline of 1.1 percent. Shares fell $2.47, or 7 percent, to $33.05.

Dillard's Inc.'s same-store sales also fell more than analysts expected. The retailer reported a drop of 5 percent for the month, mainly due to weak sales in the junior's and children's departments. Analysts anticipated a decline of 3 percent.

Shares fell 28 cents to $9.53.

In one bright spot, Kohl's Corp. _ which typically offers merchandise at lower prices than traditional department stores _ beat analysts' estimates. Its same-store sales rose 2.3 percent on strong sales of summer clothing. Analysts had expected a rise of just 0.6 percent.

Shares, though, followed the sector, sliding $1.77, or 4.2 percent, to $40.41.