Kohl's said it earned $47 million, or 30 cents a share, down from $1.51 a share in the year-ago period. On an adjusted basis, it lost a quarter a share, much smaller than the loss of 88 cents a share that analysts were expecting. Revenue fell just over 23% from the quarter a year ago, to $3.41 billion, also above the $3.07 billion consensus estimates.
AMAZON TO HIRE 3,500 WORKERS That sounds like good news, and indeed Kohl's shares did rally immediately following the report, climbing nearly 5% in early trading. The good times didn't last, however. By midmorning, the losses were mounting Kohl's was down 13.5%, to $20.28 at a recent check. So what happened? It could be a number of things. A less-bad quarter can go only so far in helping a stock, especially a department store, given that the sector has been losing market share for years, with problems that long predate the pandemic. (The boost Nordstrom (JWN) got from its better-than-feared quarter in May was short-lived.)
PAYLESS MAKES COMEBACK, SORT OF In addition, Kohl's didn't report same-store sales, citing the pandemic. Before Covid-19, it was fairly rare for a company to omit this metric. (We did, however, see a strong player, Lululemon Athletica [LULU], withhold this information, without hurting its stock.) The inference might be that if Kohl's had good news to share in terms of comps, it would have been quick to promote it.
CEO Michelle Gass also warned that the company was bracing "for the crisis to continue to impact our business in the near-term," even as she was quick to argue that the company could keep pace with changing consumer habits. That's to be expected, but not necessarily reassuring as the outbreak drags on in the U.S.
Finally, Walmart (WMT) reported today, and its results showed that sales slowed as stimulus checks began to run out last month, while back-to-school shopping has been lackluster, especially for apparel. That report may also be weighing on Kohl's, given concerns that these factors will hurt its traffic as well.
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