Trade-Ideas: Kohl's (KSS) Is Today's Pre-Market Laggard Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Kohl's ( KSS) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Kohl's as such a stock due to the following factors:

  • KSS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $155.3 million.
  • KSS traded 167,280 shares today in the pre-market hours as of 7:44 AM.
  • KSS is down 9.4% today from yesterday's close.

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More details on KSS:

Kohl's Corporation operates department stores in the United States. Its stores offer private, exclusive, and national branded apparel, footwear, and accessories for women, men, and children; soft home products, such as sheets and pillows; and housewares targeted to middle-income customers. The stock currently has a dividend yield of 2.4%. KSS has a PE ratio of 13.6. Currently there are 8 analysts that rate Kohl's a buy, 2 analysts rate it a sell, and 8 rate it a hold.

The average volume for Kohl's has been 2.4 million shares per day over the past 30 days. Kohl's has a market cap of $12.5 billion and is part of the services sector and retail industry. The stock has a beta of 0.58 and a short float of 12.3% with 7.58 days to cover. Shares are up 34.2% year to date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Kohl's as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels, expanding profit margins, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 4.2%. Since the same quarter one year prior, revenues slightly increased by 2.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 39.08% is the gross profit margin for KOHL'S CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 5.38% is above that of the industry average.
  • Net operating cash flow has significantly increased by 176.96% to $457.00 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 -5.24%.
  • The debt-to-equity ratio is somewhat low, currently at 0.76, 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 0.22 is very weak and demonstrates a lack of ability to pay short-term obligations.

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