Kohl’s Shareholders Signal Trust in Current Board

American omnichannel retailer Kohl’s (NYSE: KSS) registered another big win for its current management with the shareholders voting in the majority for the re-election of all 13 of the current board members to its Board. However, KSS stock slipped 5.6% to close at $46.65 on May 11.

Kohl’s Shareholders Support the Current Board

During an Annual Shareholder Meeting held on May 11, a preliminary vote count by the proxy solicitor showed that Kohl’s shareholders had reportedly voted in favor of reinstating the current board.

The big win came against the activist investor Macellum Advisors LLC’s push to replace up to ten directors. Macellum owns approximately a 5% stake in Kohl’s. Following the results, Macellum’s managing partner, Jonathan Duskin, said, “We contend this vote was a shareholder referendum for a sale.”

Macellum has been pushing Kohl’s to undergo major strategic changes to boost shareholder value and propel the company’s performance. Most importantly, Macellum feels that Kohl’s should either sell and lease back its real estate or sell the company outright.

Kohl’s has received buyout bids from several interested parties, and the management is stringently reviewing the bids to pick the most profitable one.

Peter Boneparth, Chairman of Kohl’s Board, said,“The Board remains focused on running a robust and intentional review of strategic alternatives while executing our strategy to drive shareholder value. We appreciate the feedback we have received from our shareholders over the past several months and look forward to engaging with them further.”

As per a WSJ report, the proxy vote from two of the large advisory firms was split; Institutional Shareholder Services Inc. supported the activists, while Glass Lewis supported the current board.

KSS Target Price

The Wall Street analysts are divided on Kohl’s, with a Moderate Buy consensus rating based on five Buys, five Holds, and one Sell. The average Kohl’s price forecast of $65.18 implies 39.7% upside potential to current levels. Meanwhile, KSS stock has lost 5% year-to-date.

Website Traffic

Kohl’s is scheduled to release its first quarter fiscal 2022 results on May 19. Let us look at what the website traffic growth reflects about Kohl’s Q1 performance.

According to the TipRanks Website Traffic Tool, in Q1, the estimated global visits to Kohl’s websites across all devices decreased by 14.85%. Similarly, year-to-date traffic growth has declined by 22.11% compared to the previous year.

This indicates that Kohl’s may report a weaker quarter compared both sequentially and to the same period last year. However, stock price performance has remained fairly stable over the quarter.

Conclusion

According to TipRanks’ Smart Score, Kohl’s has a smart score of nine, indicating that the stock is likely to outperform the market. Bloggers are bullish on the stock, and hedge funds have increased their holdings of KSS stock by 64,400 shares in the last quarter. Corporate insiders also bought $386,300 worth of Kohl’s shares in the last quarter.

Kohl’s board seems to have won the investor’s confidence for now, but all eyes are on Kohl’s upcoming results, whether the company lives up to their expectations or not.

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