A month has gone by since the last earnings report for Kohl's (KSS Quick QuoteKSS - Free Report) . Shares have lost about 2% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Kohl's due for a breakout? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent drivers for Kohl's Corporation before we dive into how investors and analysts have reacted as of late.

Kohl's Q4 Earnings Beat Estimates, Comparable Sales Dip 2.8% Y/Y

Kohl's reported fourth-quarter fiscal 2025 results, wherein the bottom line improved year over year and beat the Zacks Consensus Estimate. The top line declined year over year and missed the consensus mark.

Kohl's posted quarterly earnings of $1.07 per share, up from 95 cents in the year-ago quarter. The bottom line also outperformed the Zacks Consensus Estimate of 85 cents.

Total revenues were $5,173 million, down 4.2% from the prior-year quarter’s $5,397 million. The top line also missed the Zacks Consensus Estimate of $5,228 million. The company’s net sales fell 3.9% to $4,972 million, while other revenues fell 9.5% to $201 million. We note that comparable sales dipped 2.8% year over year, primarily due to the decline in store transactions.

Kohl’s Quarterly Margin Highlights

Kohl's gross margin expanded 25 basis points (bps) to 33.1% in the reported quarter. The improvement was primarily driven by strong inventory management, which led to lower clearance markdowns. However, the benefit was partially offset by higher shipping costs, as digital penetration increased 220 bps to 35% of total sales for the quarter.

SG&A expenses dropped 4.9% to $1,463 million. As a percentage of total revenues, SG&A expenses decreased 23 bps to 28.3%.

Operating income increased to $212 million, up from $126 million in the prior year. The prior year’s adjusted operating income was $202 million. Operating margin was 4.1%, reflecting an increase of 176 bps year over year, and a 35-bps improvement compared with the prior year’s adjusted operating margin.

KSS’ Financial Health Snapshot & Other Updates

Kohl's ended the quarter with cash and cash equivalents of $674 million and shareholders’ equity of $4,048 million. 

For fiscal 2025, net cash provided by operating activities was $1,380 million. Management expects capital expenditures in the range of $350 million to $400 million for fiscal 2026.

On Feb. 25, 2026, Kohl’s declared a quarterly cash dividend of 12.50 cents per share, payable April 1, to its shareholders of record as of March 18.

What to Expect From KSS in FY26?

For fiscal 2026, Kohl’s expects net sales and comparable sales to decline 2% to flat, with an adjusted operating margin of 2.8% to 3.4% and adjusted earnings per share in the range of $1.00 to $1.60.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended downward during the past month.

The consensus estimate has shifted -17.39% due to these changes.

VGM Scores

At this time, Kohl's has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Kohl's has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.