Kohl’s Surprises Analysts With Huge Bottom-Line Beat

Kohl’s Corp. (NYSE: KSS) reported its fiscal second-quarter financial results before the markets opened on Thursday. The company posted $1.22 in earnings per share (EPS) on $4.18 billion in revenue. The Thomson Reuters consensus estimates had called for $1.03 in EPS on revenue of $4.16 billion. Kohl’s posted EPS of $1.07 and $4.27 billion in revenue in the same period of last year.

Comparable store sales for the most recent quarter were down 1.8% year over year.

In terms of guidance, the company now expects EPS for the fiscal full year to be in the range of $3.80 to $4.00, down from the previous range of $4.05 to $4.25. The consensus estimates for the full-year are $3.83 in EPS on $18.89 billion in revenue.

Kohl’s ended the quarter with 1,150 Kohl’s stores, 12 FILA Outlet stores and three Off/Aisle clearance centers in 49 states, compared with 1,164 Kohl’s stores at the same time last year.

The board of directors declared a quarterly cash dividend on the common stock of $0.50 per share. The dividend is payable September 21 to shareholders of record at the close of business on September 7.

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Kevin Mansell, board chair, chief executive and president of Kohl’s, commented on the earnings report:

Our sales improved over our first quarter results, but were below our expectations. We are encouraged by the performance of juniors and young men’s as we enter the Back-to-School season. Our inventory management initiatives helped us to achieve a strong increase in gross margin with ending inventory per store down significantly from last year. Our associates throughout the organization continue to effectively manage expenses in response to changing sales trends and I appreciate all of their efforts.

On the books, Kohl’s cash and cash equivalents totaled $700 million at the end of the quarter, versus $934 million at the end of the same period from last year.

Shares of Kohl’s were trading up 13.5% at $43.19 on Thursday, with a consensus analyst price target of $41.25 and a 52-week trading range of $33.87 to $57.66.

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