We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Headquartered in Menomonee Falls, WI, Kohl’s Corp. (KSS - Free Report) is the number two department store chain in the U.S. Its stores offer moderately-priced apparel, footwear, and accessories for women, men and kids; beauty items; and home décor. Kohl’s currently operates over 1,100 stores across 49 states, as well as kohls.com and the Kohl’s smartphone app.
Q2 Earnings Recap
Total revenue hit $4.45 billion, with net sales of $4.22 billion, growing over 30% year-over-year; the company’s top line also surpassed revenue and sales for Q2 2019.
Gross margin surged 42.5% compared to 33.1% in the prior-year period and 38.3% in the second quarter of 2019 thanks to Kohl’s ability to cut back on promotions as inventory remains low.
As a result, earnings showed impressive growth. The bottom line hit a record of $2.48 per share, or over twice the analyst consensus of $1.16. This, in turn, allowed the department store to generate a hefty $1.25 billion of free cash flow last quarter.
Kohl’s also repurchased $255 million of stock in Q2.
Because of its blowout second quarter, management raised its full-year outlook for the second time and now expects to generate adjusted EPS between $5.80 and $6.10 per share (vs. its previous forecast of $3.80 and $4.20 per share), which would be another record.
Could KSS Break Out?
Over the past one year, shares of KSS have risen over 147% compared to the S&P 500’s gain of 31.9%. Earnings estimates have climbed as well, making the retailer a Zacks Rank #1 (Strong Buy) right now.
For the current fiscal year, eight analysts have revised their bottom-line estimate upwards in the last 60 days, and the Zacks Consensus Estimate has moved up from $4.04 per share to $6.09 per share. Earnings are expected to see triple-digit growth of more than 600% for fiscal 2022, with 2023 continuing the positive earnings growth trend.
Considering Kohl’s latest guidance, share trade at a bargain level of about 9.2X forward earnings, especially given its very strong balance sheet and growth outlook.
Additionally, the company just began the rollout of its partnership with beauty behemoth Sephora, a promising partnership that should boost its top line over the next few years. Kohl’s has also added popular brands like Eddie Bauer and Tommy Hilfiger to its product mix.
If you’re an investor searching for a retail stock to add to your portfolio, make sure to keep KSS on your shortlist.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Bull of the Day: Kohl's (KSS)
Headquartered in Menomonee Falls, WI, Kohl’s Corp. (KSS - Free Report) is the number two department store chain in the U.S. Its stores offer moderately-priced apparel, footwear, and accessories for women, men and kids; beauty items; and home décor. Kohl’s currently operates over 1,100 stores across 49 states, as well as kohls.com and the Kohl’s smartphone app.
Q2 Earnings Recap
Total revenue hit $4.45 billion, with net sales of $4.22 billion, growing over 30% year-over-year; the company’s top line also surpassed revenue and sales for Q2 2019.
Gross margin surged 42.5% compared to 33.1% in the prior-year period and 38.3% in the second quarter of 2019 thanks to Kohl’s ability to cut back on promotions as inventory remains low.
As a result, earnings showed impressive growth. The bottom line hit a record of $2.48 per share, or over twice the analyst consensus of $1.16. This, in turn, allowed the department store to generate a hefty $1.25 billion of free cash flow last quarter.
Kohl’s also repurchased $255 million of stock in Q2.
Because of its blowout second quarter, management raised its full-year outlook for the second time and now expects to generate adjusted EPS between $5.80 and $6.10 per share (vs. its previous forecast of $3.80 and $4.20 per share), which would be another record.
Could KSS Break Out?
Over the past one year, shares of KSS have risen over 147% compared to the S&P 500’s gain of 31.9%. Earnings estimates have climbed as well, making the retailer a Zacks Rank #1 (Strong Buy) right now.
For the current fiscal year, eight analysts have revised their bottom-line estimate upwards in the last 60 days, and the Zacks Consensus Estimate has moved up from $4.04 per share to $6.09 per share. Earnings are expected to see triple-digit growth of more than 600% for fiscal 2022, with 2023 continuing the positive earnings growth trend.
Considering Kohl’s latest guidance, share trade at a bargain level of about 9.2X forward earnings, especially given its very strong balance sheet and growth outlook.
Additionally, the company just began the rollout of its partnership with beauty behemoth Sephora, a promising partnership that should boost its top line over the next few years. Kohl’s has also added popular brands like Eddie Bauer and Tommy Hilfiger to its product mix.
If you’re an investor searching for a retail stock to add to your portfolio, make sure to keep KSS on your shortlist.