Kohl’s Stock: Why Most Analysts Have a ‘Hold’ Rating
As of September 26, 2017, Kohl’s (KSS) stock was rated as a “hold” by 68% or 15 out of 22 analysts. The stock was rated as a “buy” by four analysts and as a “sell” by three analysts. On August 10, 2017, Gordon Haskett upgraded Kohl’s stock from “reduce” to “hold” with a target price of $37.00—up from the previous target of $36.00.
On August 11, Credit Suisse raised its recommendation for Kohl’s stock from “underperform” to “neutral.” Credit Suisse also raised its price target for Kohl’s stock to $44.00 from $39.00.
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Consensus “hold” rating
Most of the analysts covering Kohl’s stock gave a consensus “hold” rating. Kohl’s has been struggling to deliver higher sales in a tough retail market. The competition from Amazon (AMZN) and off-price retailers is having a negative impact on Kohl’s and other department stores’ sales growth. A heavy promotional environment is also having a negative impact on the company’s margins. Investments to support online growth and other strategic initiatives are impacting the company’s profitability.
Kohl’s is taking several initiatives to improve its sales performance. The company is also aiming for improved productivity and is targeting expense savings of over $250 million in the next three years. Kohl’s is also focusing on smaller format stores that will be more productive. The company is scheduled to open four new 35,000 square foot stores in October.
12-month target price
As of September 26, the average 12-month target prices for Kohl’s stock was $42.44. The target price indicates more downside potential of 8.3%—compared to the company’s closing stock price of $46.27 on September 26. Kohl’s stock has fallen 6.3% on a year-to-date basis.
Kohl’s is slated to announce its fiscal 3Q17 results on November 9. The company’s upcoming results might cause another revision to its 12-month target price.
For more updates, visit Market Realist’s Department Stores page.