Kohl's Corp (KSS, Financial) has recently experienced a notable uptick in its stock performance, with a market capitalization now standing at $2.92 billion. The current price of the stock is $26.38, reflecting a 5.23% gain over the past week and a 12.72% gain over the past three months. Despite these gains, the GF Value of the stock is $46.37, down from a past GF Value of $49.21. This suggests that the stock may be a possible value trap, and investors should think twice before making an investment, as the GF Valuation has remained consistent with the past valuation of a possible value trap.
Introduction to Kohl's Corp
Kohl's Corp, a mainstay in the retail - cyclical industry, operates approximately 1,170 department stores across 49 states. These stores offer moderately priced private-label and national brand clothing, shoes, accessories, cosmetics, and home furnishings, primarily in strip centers. Additionally, Kohl's has a significant digital sales business. Women's apparel is a major revenue driver for the company, accounting for 27% of its 2022 sales. Founded in 1962 and headquartered in Menomonee Falls, Wisconsin, Kohl's has established itself as a significant player in the department store sector.
Assessing Kohl's Profitability
Kohl's Corp boasts a Profitability Rank of 7/10, indicating a strong position relative to its peers. The company's operating margin stands at 0.66%, which is better than 33.03% of 1,108 companies in the same industry. However, the Return on Equity (ROE) is at -3.72%, which, while better than 25.57% of 1,087 companies, indicates a negative return on shareholder equity. The Return on Assets (ROA) is also negative at -0.94%, but still outperforms 29.7% of 1,118 companies. The Return on Invested Capital (ROIC) is 0.61%, surpassing 34.29% of 1,117 companies. Over the past decade, Kohl's has maintained profitability for 8 years, which is better than 58.7% of 1,046 companies.
Growth Prospects of Kohl's
The Growth Rank for Kohl's is 4/10, reflecting moderate growth potential. The company has seen a 6.10% 3-Year Revenue Growth Rate per Share, outperforming 55.66% of 1,042 companies. The 5-Year Revenue Growth Rate per Share is 3.40%, which is better than 53.11% of 917 companies. However, the Total Revenue Growth Rate (Future 3Y To 5Y Est) is slightly negative at -0.11%, yet still better than 17.36% of 242 companies. The 3-Year EPS without NRI Growth Rate is an impressive 50.10%, which is higher than 87.17% of 834 companies.
Key Shareholders in Kohl's
Among the notable holders of Kohl's stock, T Rowe Price Equity Income Fund (Trades, Portfolio) leads with 2,920,000 shares, representing 2.64% of the company's shares. HOTCHKIS & WILEY holds 251,900 shares, accounting for 0.23% of the shares, followed by Jefferies Group (Trades, Portfolio) with 184,469 shares, making up 0.17% of the shares.
Competitive Landscape
When compared to its competitors, Kohl's Corp holds its own within the retail industry. Nordstrom Inc (JWN, Financial) has a market cap close to Kohl's at $2.84 billion, while Macy's Inc (M, Financial) is larger with a market cap of $5.69 billion. Vestiage Inc (VEST, Financial), although a competitor, is significantly smaller with a market cap of $1.167 million.
Conclusion
In summary, Kohl's Corp has shown a positive trend in its stock performance with a significant gain over the past three months. The company's profitability metrics, while mixed, suggest a stable financial standing, and its growth rates indicate potential for future expansion. However, the GF Valuation advises caution, labeling the stock as a possible value trap. When considering Kohl's position within the retail industry and its comparison with competitors, investors should weigh these factors carefully. The company's valuation and investment potential, based on the provided data, suggest that while there are positive aspects, a careful analysis is recommended before proceeding with an investment.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
