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Nordstrom upgraded to 'buy' Add to ...

Nordstrom Inc. jumped 5.35 per cent in the Monday morning session after Goldman Sachs Group upgraded the stock to "buy" from "neutral," adding it to its "conviction buy list," with a 12-month target of $57 (U.S.). "We see Nordstrom as the cheapest way to play luxury retail," writes analyst Adrianne Shapira, citing a significant valuation discount to its luxury peer group, a fiscal 2007 profit estimate ahead of consensus and "approaching [July]same-store-sales catalysts" due to be reported in early August. The stock is changing hands at $46.26, up $2.35, on the NYSE, representing a hefty upside to her price target. Ms. Shapira sees similarities between the stock's trading pattern these days and mid-2006, when an 80 per cent-plus rally followed the July release of same-store-sales. The stock is down some 20 per cent since mid-February but the analyst contends business trends remain robust. She suspects a "similar rally could ignite as approaching July and August same-store-sales results are released," restoring investor confidence and lifting the stock price to her target over the next several quarters.

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