Kohl's Posts In-Line Earnings; Issues $1Billion Share Repurchase

Kohl'sKSS released an in-line 3Q EPS result and announced a plan to initiate a $1.0 billion accelerated share repurchase program in short order Net/net, while inventory levels were a tad heavy and we didn't like to see the upward revision to the 1x charge, we think the combination of the 4Q guidance being reiterated along with the ASR will be more than enough to get the stock moving in the right direction. KSS printed 3Q EPS of $0.63, in line with J.P Morgan's estimate and Street consensus and at the high end of the latest company guidance of $0.62-$0.63, which excludes the previously estimated $0.05 charge due to accounting adjustments. Importantly, JPM notes that KSS now believes the 3Q charge could range from $0.05 to $0.15 based on leases that have been reviewed to date. The 4Q EPS range of $1.51- $1.59, excluding share repurchases, was reiterated. J.P Morgan is currently modeling 4Q EPS of $1.58. J.P Morgan has an Overweight rating on KSS KSS is trading higher at $52.26