Piper Jaffray Gives Color On Retailers Ahead Of The Holiday Season

Urban Outfitters URBN; Neutral-rated stock, but believe the long-only funds are lining up to own this 2011 growth story should same-store sales track around the +MSD level while hedge funds are largely short this stock. Piper is on the sidelines for now and willing to buy this higher; we need an all-clear that the deflationary environment of the teen space isn't cramping the U.O. division's style. Nordstrom JWN; Overweight-rated stock, and believe in the $4+ EPS longer-term story. Incremental investments in people and technologies as well as a negatively "comping" Rack division keep upside to earnings at bay... for now. Setting up to be one of the single best large-cap retailing stories for 2011, however, as underlying same-store sales momentum has built even the past two months against more difficult comparisons. Piper recommends to buy JWN shares on any weakness. Ann Taylor ANN; LOFT, yet again, comes under scrutiny heading into the earnings report. Comparing the two divisions' performances is like comparing Nordstrom to New York & Co. with respect to income demographic profiles. Should LOFT hold slightly positive comps without crunching the margins, then this stock should see new heights. Piper is buyers of ANN shares. URBN closed Friday at $32.90 JWN closed Friday at $41.40 ANN closed Friday at $22.93