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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