Jim Cramer Says It May Be Time to Buy Shares of This Department Store

According to CNBC’s Jim Cramer, now maybe the time to pick up some shares of Nordstrom.

The Mad Money host believes the stock is worth looking at after the holiday season.

Recently J.P. Morgan analyst Matthew Boss released a bullish report on the company. Boss upgraded Nordstrom to neutral from underweight. The analyst noted that about 34% of Nordstrom’s sales come from online, with the goal of reaching 40% by 2022. That puts the retailer ahead of its competitors.

“If any of these pans out, you could get a rocket ship effect … with Nordstrom being the best way to play the holiday season renaissance,” Cramer said. Given Boss’ track record, “I think you’d be crazy, crazy, to bet against him,” Cramer added.

According to Cramer, the problem with Nordstrom is the retailers’ execution, not forces around consumer spending.

Cramer remarked, “It’s not that the consumer’s weak, which means these problems could be fixable and should be fixable.”
“Nordstrom sports a 3.6% yield, and Boss projects that it can deliver 2.3% sales growth. Wall Street’s only looking for
1.6%. That will ignite the stock,” Cramer commented.

As for rival Macy’s, Boss has reiterated a “sell” rating but increased same-store sales forecasts by a percentage point. Cramer said, “Don’t forget that the stock yields 8.7% here and the balance sheet keeps improving.”

“The conventional wisdom says that these department stores are facing shortfalls across the board, yet Boss is talking about a robust holiday season,” Cramer mentioned.

If Boss is right, “that could produce a staggering short-squeeze in their stocks because so many of these names have been written off and left for dead and heavily shorted,” said Cramer.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.