MKM partners came out Monday with their earnings preview for Kohl's KSS. The firm maintained a Buy recommendation with a $63 price target.
MKM expects second quarter EPS of $1.02 compared to consensus $1.07 estimate.
Although recently outperforming the S&P 500, MKM feels that the stock is still comparatively cheap on a valuation basis at 11.6 times their 2015 earnings estimate.
MKM also points out that comps are likely to have improved versus the first quarter, and that although traffic was likely to have contracted, their view is below consensus of a 4.5 percent decrease in store traffic for the second quarter.
The firm also likes the 2.8 percent dividend yield and think Kohl's will generate about $1.1 billion in free cash flow in FY14, also a positive.
Shares of Kohl's were trading at $55.76, up 0.07 percent.
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