Nordstrom and Kohl’s Expect Profit to Rise More

A day after Macy’s and Polo Ralph Lauren raised their profit outlooks for the year, Nordstrom and Kohl’s did the same. Both stores said that shoppers continued to follow well-established patterns through the end of July, whether that meant buying full-priced designer items at Nordstrom or being selective about spending at Kohl’s.

Kohl’s shares rose 7.25 percent and Nordstrom’s 5.46 percent on Thursday, when the Dow Jones industrial average increased 423.37 points, or 3.95 percent.

At Kohl’s, shoppers were more worried about the price of gas and food than they were about the value of stocks, and that has been the case for some time, said Kevin Mansell, Kohl’s chief executive. He said long-term economic shifts, like bear and bull markets or worldwide sovereign debt problems, did not typically affect consumer behavior right away.

“It’s sort of more something you see over a period of time, as people realize it had an impact on my 401(k) or my job search,” Mr. Mansell said in a telephone interview.

While Kohl’s profit beat expectations, executives “weren’t happy” with its sales performance, Mr. Mansell told investors on Thursday. Kohl’s sales rose 3.6 percent to $4.2 billion for the quarter, and its sales at stores open more than a year rose 1.9 percent. Mr. Mansell said that Kohl’s was planning heavy marketing in the fall to encourage more spending.

“Our shopper is a more moderate consumer, and a more middle-income consumer is typically more focused on things that take money out of their pocket now, and the obvious ones are rent payments and mortgage payments and fuel prices,” along with rising food costs, Mr. Mansell said. “We’ll see more change when people are seeing food prices come back down, or fuel prices stabilize.”

Kohl’s profits rose 16.5 percent to $303 million, or $1.09 a share, a penny more than analysts had expected.

The retailer raised its projected earnings per share for the year by 20 cents, to $4.45 to $4.60.

At Nordstrom, which attracts a higher-income crowd, shoppers were spending on full-priced items, particularly those from designers, the company said. And its July anniversary sale, where it sells brand-new fall merchandise at a discount before shifting to regular prices, was the best in Nordstrom’s history, its president, Blake W. Nordstrom, told investors.

Nordstrom’s profit rose 20 percent to $175 million, or 80 cents a share, 6 cents more than analysts had predicted.

Its sales increased 12.4 percent, to $2.72 billion.

Earlier in the year, Nordstrom had said annual earnings per share would not be as high as it had expected, but on Thursday, it returned to the original predictions of a full-year profit of $2.95 to $3.10 a share.

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