UPDATE: Jefferies & Company Reiterates Buy Rating, Lowers PT on Kohl's Corporation
In a report published Friday, Jefferies & Company reiterated its Buy rating on Kohl's Corporation (NYSE: KSS), but lowered its price target from $54.00 to $52.00.
Jefferies noted, “We are maintaining our Buy rating but lowering our price target to $52 from $54 following the December sales release. We are lowering our Q4, FY13, and FY14 EPS estimates to $1.61, $4.12, and $4.76 from $1.86, $4.36, and $4.94, respectively. This reflects our lowered comp store sales and margin expectations. The December comp store sales result beat expectations, but end of season markdowns on excess inventory pushes EPS lower. About 65% of the margin miss is due to clearance, while the rest was due to increased promotion in the days leading up to Christmas. At this point KSS shares look washed out and are selling at a double digit FCF yield. The next potential catalysts will be improved results for spring as content continues to evolve and comparisons remain easy. We also expect that we will see some margin rebound in the spring as Kohl's laps a period of higher price investment, which occurred during a period of rising cost of goods sold. Lastly, we should hear more news on developments in the beauty business, additional management appointments in marketing, and a new loyalty program.”
Kohl's Corporation closed on Thursday at $42.35.
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