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Factors to Watch Before Kohl's (KSS) Q1 Earnings Release

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Kohl's Corporation (KSS - Free Report) is likely to post an increase in the top and the bottom line in its first-quarter fiscal 2021 results on May 20. The Zacks Consensus Estimate for the bottom line has narrowed from a loss of 15 cents per share to a loss of 3 cents in the past 30 days. The projection shows significant improvement from a loss of $3.20 per share reported in the year-ago quarter. Notably, this department store chain has a trailing four-quarter earnings surprise of 52.5%, on average.

The consensus estimate for quarterly revenues is pegged at approximately $3.5 billion, which calls for a growth of 43.8% from the prior-year quarter’s reported number.

Kohls Corporation Price and EPS Surprise

 

Kohls Corporation Price and EPS Surprise

Kohls Corporation price-eps-surprise | Kohls Corporation Quote

 

Factors to Note

Kohl’s is benefiting from its growing digital business, especially amid the coronavirus outbreak. To this end, the company remains focused on making investments in its online business and enhancing its omnichannel capabilities to cater to rising demand. Kohl’s strategic plan that focuses on four key areas — driving top-line growth, expanding operating margin, implementing disciplined capital management and undertaking an agile accountable and inclusive culture — has been yielding. Certainly, strength in the company’s brand portfolio along with prudent alliances is aiding growth.

That being said, Kohl’s is battling drab gross margin thanks to increased freight surcharges amid rising digital penetration. Rising SG&A expenses, as a percentage of total revenues, is a threat.

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 sports a Zacks Rank #1 and an Earnings ESP of +155.56%.

More Stocks With Favorable Combinations

Here are some more 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.

Foot Locker, Inc. (FL - Free Report) currently has an Earnings ESP of +4.72% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ulta Beauty, Inc. (ULTA - Free Report) currently has an Earnings ESP of +9.52% and carries a Zacks Rank #2.

Lowe’s Companies, Inc. (LOW - Free Report) currently has an Earnings ESP of +2.73% and a Zacks Rank #3.

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