Nordstrom Downgraded To Underweight At Morgan Stanley

Nordstrom Inc. was downgraded to underweight from equal-weight at Morgan Stanley, which believes the retailer's earnings potential is limited. Analysts lowered the price target to $45 from $61. Morgan Stanley was equal-weight on Nordstrom since Nov. 2011, it said in a Thursday note. The brokerage forecasts a decline in department store margins in 2016 driven by a shift to e-commerce. Among the other issues Nordstrom faces are eroding sales at its off-price Rack stores and less money for buybacks. Still, Morgan Stanley believes Nordstrom offers "standout service, competitive prcing, coveted product and [a] seamless multichannel shopping experience." Analysts said the retailer will remain "highly relevant." Nordstrom shares are up 1.4% today, but down 38.1% for the past 12 months. The S&P is down 3.7% for the past year.