Back to top

Image: Bigstock

Kohl's (KSS) Extended Deal With Capital One to Fuel Growth

Read MoreHide Full Article

Kohl's Corporation (KSS - Free Report) unveiled the multi-year extension of its credit card program deal with Capital One, National Association, which is a subsidiary of Capital One Financial Corporation (COF - Free Report) . This marks the second agreement extension for both the companies, with the latest one in 2014. This extension will help Kohl’s and Capital One Financial’s Capital One, National Association to strengthen their ties and offer solid experiences and products to the former’s customers.

Kohl’s and Capital One Financial each currently carry a Zacks Rank #3 (Hold). Shares of KSS have rallied 17% in the past six months compared with the industry’s growth of 23.2%. Meanwhile, COF’s stock price has declined 13.4% at the same time. 

Zacks Investment Research
Image Source: Zacks Investment Research

Kohl’s Focuses on Enriching Customer Service

Kohl’s private label credit card program, Kohl’s Card, provides customers with access to unique offers, savings and online payment options. This agreement will help the company enhance this program, thereby underscoring its focus on enriching services to customers. Both the contract parties have also agreed to a co-branded card product, which will be piloted as early as 2023.

Kohl’s loyalty products include its Kohl's Card, Kohl's Rewards and the retailer’s iconic Kohl's Cash coupons. KSS recently revealed its intentions to roll out improved rewards for holders of Kohl’s Card this spring. Apart from this, Kohl’s is also renowned for its other prudent partnerships, which have been working well for this Wisconsin-based company.

The company has been benefiting from the rollout of Amazon’s (AMZN - Free Report) Amazon returns program nationwide. Per this program, Kohl’s stores accept free, unpackaged and easy returns for customers of Amazon. The company is impressed with the performance of AMZN’s Amazon returns program. One of the prime objectives of this program is to convert more customers into loyal Kohl’s shoppers.

Kohl’s solid partnership with Sephora to create a new era of elevated Beauty at Kohl's is also noteworthy. Recently, Kohl's unveiled plans to add another 400 Sephora at Kohl’s shops after seeing the success in the first 200 stores. This takes the total of Sephora at Kohl’s locations to 600, which keeps the alliance between the two companies on track to achieve their goal of 850 stores by 2023. This is likely to further enhance customers’ experiences at Kohl’s stores.

Coming back to Kohl’s, the abovementioned deal extension with Capital One Financial’s Capital One, National Association is likely to benefit both the companies and solidify their ties, which were initiated back in 2011.

A Retail Stock Worth Noting

Dillard's, Inc. (DDS - Free Report) , a retail department stores operator, currently has a Zacks Rank #2 (Buy). Dillard's has a trailing four-quarter earnings surprise of 294.8%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Dillard's current financial-year sales suggests growth of 4.7% from the year-ago period’s reported figure. Shares of DDS have rallied 41% in the past six months.

Published in