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Kohl's (KSS) to Report Q4 Earnings: What Awaits the Stock?

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Kohl's Corporation (KSS - Free Report) is likely to post declines for both the top and the bottom line in its fourth-quarter fiscal 2020 results on Mar 2. Although, the Zacks Consensus Estimate for fiscal fourth-quarter earnings has moved up from 73 cents per share to 95 cents per share in the past 30 days, it suggests a slump of 52.3% from year-ago quarter’s reported number. For fiscal 2020, the Zacks Consensus Estimate for earnings is pegged at a loss of $2.49 per share, which suggests deterioration from earnings of $4.86 per share posted in the prior-year. Notably, this department store chain has a trailing four-quarter earnings surprise of 25.6%, on average.

The consensus estimate for quarterly revenues is pegged at $6.13 billion, which calls for a decline of 10.3% from the prior-year quarter’s levels. For fiscal 2020, the consensus mark is pegged at $15.94 million, which suggests a slump of 20.2% from the year-ago period’s reported number.

Kohls Corporation Price, Consensus and EPS Surprise

 

Kohls Corporation Price, Consensus and EPS Surprise

Kohls Corporation price-consensus-eps-surprise-chart | Kohls Corporation Quote

 

Factors to Note

Recently, Kohl's provided an update on its fourth-quarter fiscal 2020 performance. Per its preliminary results for the quarter under review, total revenues declined approximately 10% year over year. Also, comparable sales fell 11% in the quarter. Nevertheless, management pointed that the company’s sales trend has been improving.

Additionally, Kohl's has been seeing impressive momentum in its online business. In fact, stellar digital sales added gleam to the fiscal fourth-quarter performance. Impressively, digital sales soared more than 20%, and accounted for over 40% of net sales in the to-be-reported quarter. All said, the company envisions fiscal fourth-quarter earnings in the band of $1.00-$1.05 per share.

The aforementioned preliminary results indicate stronger-than-anticipated gross margin rate and effective SG&A expense management during the quarter under review. Better inventory management and optimization in promotional strategies is likely to have had benefited gross margin. Additionally, lower store, marketing and technology expenses are likely to have lowered SG&A expenses.

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Kohl's this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Kohl's carries a Zacks Rank #3 and has an Earnings ESP of +2.79%.

Other Stocks With Favorable Combinations

Here are some other companies that you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat.

DICK’S Sporting Goods, Inc. (DKS - Free Report) currently has an Earnings ESP of +3.93% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Dollar Tree, Inc. (DLTR - Free Report) currently has an Earnings ESP of +1.94% and a Zacks Rank #2.

Five Below, Inc. (FIVE - Free Report) currently has an Earnings ESP of +0.27% and carries a Zacks Rank #2.

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