This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

January Sales Weigh on Kohl's Corporation (KSS) Guidance

NEW YORK (TheStreet) -- Kohl's Corporation (KSS - Get Report), in its fourth-quarter update Thursday, said comparable-store sales for the January-ended quarter decreased 2%, though an increase of 0.8% over a combined November and December, the critically-important holiday shopping season for the retailer.

For the time being, investors concerned with how the retailer would fare over this holiday season's cutthroat, aggressively-competitive environment have been reassured. At competitor Sears (SHLD - Get Report), for instance, its namesake stores suffered a 9.2% decrease in comparable-store sales through to Jan. 6.

However, the department store chain warned of significantly lower January sales, resulting from lower traffic and low levels of clearance merchandise.

Additionally, unexpected expenses servicing its e-commerce website increased costs over the quarter, though specifics were not detailed.

Must Read: Why Akamai (AKAM) Was Upgraded

As a result of higher-than-anticipated costs and lower sales last month, the company revised its per-share earnings estimate to $1.53 from prior guidance of $1.59 to $1.74. Analysts surveyed by Thomson Reuters had expected earnings of $1.63.

For the full year, management anticipates net income of $4.03 a share, downwardly revised from previous guidance of $4.08 to $4.23. Analysts had forecast $4.12 a share.

The Wisconsin-based business will release fourth-quarter and full-year results on Feb. 27.

By mid-morning, shares were up 4.6% to $52.14.

Must read: J.C. Penney Is No Bargain as Volume Soars and Shares Plunge

Must read: J.C. Penney's Comparable Sales Are Up, But Investors Flee

TheStreet Ratings team rates KOHL'S CORP as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate KOHL'S CORP (KSS) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has significantly increased by 108.26% to $252.00 million when compared to the same quarter last year. In addition, KOHL'S CORP has also vastly surpassed the industry average cash flow growth rate of -21.57%.
  • The debt-to-equity ratio is somewhat low, currently at 0.82, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.16 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 2.4%. Since the same quarter one year prior, revenues slightly dropped by 1.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
KSS $45.51 -1.02%
SHLD $18.06 -0.50%
AAPL $95.03 -2.90%
FB $116.73 7.20%
GOOG $691.02 -2.10%


Chart of I:DJI
DOW 17,830.76 -210.79 -1.17%
S&P 500 2,075.81 -19.34 -0.92%
NASDAQ 4,805.2910 -57.85 -1.19%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs