Kohl’s shares close sharply lower on Tuesday as quarterly earnings, comparable sales miss estimates, full-year earnings forecast cut

November 20, 2019 10:07 am

Kohl’s Corp’s (KSS) third-quarter earnings and comparable sales, reported on Tuesday, fell short of Wall Street estimates. The retailer also revised down its full-year adjusted earnings forecast ahead of the holiday shopping season, which sent its shares down by almost 20% yesterday.

Kohl’s shares closed lower for a second consecutive trading session in New York on Tuesday. It has also been the steepest daily loss in more than 10 years. The stock went down 19.49% ($11.38) to $47.02, after touching an intraday low at $47.01, or a price level not seen since October 8th ($46.70).

Shares of Kohl’s Corporation have retreated 29.12% so far in 2019 compared with a 24.47% gain for the benchmark index, S&P 500 (SPX).

In 2018, Kohl’s Corp’s stock went up 22.33%, thus, it outperformed the S&P 500, which registered a 6.24% loss.

Kohl’s said that sales at stores, which are open for at least 12 months, grew 0.4% year-on-year during the third quarter ended on November 2nd. The figure compares with a 0.76% sales growth expected by analysts.

Net income attributable to shareholders went down to $123 million ($0.78 per share) during the latest fiscal quarter from $161 million ($0.98 per share) in the year-ago period.

Meanwhile, Kohl’s earnings per share, which exclude special items, were reported at $0.74 during the third quarter, which again fell short of the median analyst forecast of $0.86 per share.

The department store chain also said it now expected adjusted earnings per share within the range of $4.75 to $4.95 during fiscal year 2019. Previously, the company had forecast adjusted profit of $5.15 to $5.45 per share for the full year.

Analyst stock price forecast and recommendation

According to CNN Money, the 16 analysts, offering 12-month forecasts regarding Kohl’s Corporation’s stock price, have a median target of $57.00, with a high estimate of $75.00 and a low estimate of $44.00. The median estimate represents a 21.23% upside compared to the closing price of $47.02 on November 19th.

The same media also reported that at least 6 out of 17 surveyed investment analysts had rated Kohl’s Corporation’s stock as “Hold”, while other 6 – as “Buy”. On the other hand, 2 analysts had recommended selling the stock.

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