Shares of Nordstrom (NYSE:JWN) were climbing today as the department store stock gained in response to a strong earnings report from Dillard's (NYSE:DDS) and as the April retail sales report showed the sector continuing to perform well.
Nordstrom finished the day up 11.3%.
Dillard's, the Arkansas-based department store chain, beat estimates on the top and bottom line, and said that revenue jumped 73% as it lapped the quarter when lockdowns began a year ago. It delivered earnings per share of $7.25, a company record and well ahead of estimates at $1.54.
Management also said that gross margin reached a record of 42% as it benefited from the March stimulus check, increasing vaccinations, and warmer weather. Results were better than 2019 levels.
Meanwhile, from March to April, department store sales actually fell 1.5% according to the Census Bureau. However, that was still on par with 2019 levels, further encouraging investors.
Combined, the reports show that Americans are eager to return to department stores and shop as the health crisis begins to fade.
Nordstrom, considered a higher-end retailer than most of its department store peers, will report earnings on May 25. The company has a strong e-commerce business and a more limited footprint than other department store chains, so it was in a better position to weather the challenges of the pandemic.
For the first-quarter report, analysts are expecting revenue to rise 17.9% to $2.85 billion and see a loss per share of $0.64. However, after Dillard's delivered blowout results, those estimates are likely to get a boost, and that's one reason for today's gains.