In a report released yesterday, Alexandra Straton from Morgan Stanley maintained a Sell rating on Kohl’s (KSS – Research Report), with a price target of $8.00.
Alexandra Straton’s rating is based on several factors that indicate potential challenges for Kohl’s. The recent quarterly results confirmed concerns about the company’s future earnings guidance, which is expected to fall short of market expectations. Additionally, there are ongoing fundamental pressures and doubts about the effectiveness of previous management strategies that may have alienated the core customer base without successfully attracting new customers.
Despite a change in management and an updated strategy for 2025, Straton notes that the focus areas do not significantly differ from past approaches, and re-engaging the core customer could be challenging while attempting to improve marketing and operational efficiencies. Moreover, successful turnarounds in the apparel retail sector are historically rare, especially in a difficult macroeconomic environment, and often come with volatile quarterly results. These factors, combined with potential risks to future earnings estimates and valuation concerns, suggest that the stock could face further downside, leading to the Sell rating.
In another report released today, Bank of America Securities also reiterated a Sell rating on the stock with a $8.00 price target.
KSS’s price has also changed dramatically for the past six months – from $19.080 to $9.150, which is a -52.04% drop .
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