What's Going On With Kohl's (KSS) Stock?

Kohl’s Corp KSS shares are trading higher by 5.6% to $17.99 Monday morning. The company is set to report third-quarter results Tuesday before the market open.

What Happened: Kohl's heads into its third-quarter earnings release with a focus on improving operational efficiency and navigating continued sales pressure. In the second quarter, net sales declined by 4.2% year-over-year to $3.525 billion, with comparable sales down 5.1%.

Despite these challenges, the company exceeded EPS expectations, reporting 59 cents versus the 44 cent consensus, supported by a 59-basis-point expansion in gross margin to 39.6%.

Operational improvements were evident as SG&A expenses declined 4.2% year-over-year, contributing to a 26-basis-point increase in operating margin to 4.4%. Inventory management was a highlight, with a 9% year-over-year reduction in inventory, aligning with the company's efficiency goals.

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For Q3, attention will likely focus on Kohl's ability to stabilize sales amidst macroeconomic headwinds and discretionary spending pressures, which impacted second-quarter performance.

Key growth areas, including the Sephora partnership and categories like home decor and gifting, will be critical drivers. The recent partnership with Babies "R" Us may also begin contributing incremental gains.

Kohl's raised its FY24 EPS outlook to $1.75–$2.25, reflecting confidence in margin expansion, despite revised guidance for FY24 sales and comparable sales declines of 4–6% and 3–5%, respectively. Investors will look for evidence in third-quarter results that Kohl's is successfully executing its strategies to balance cost controls with growth investments.

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How To Buy KSS Stock

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in Kohl’s case, it is in the Consumer Discretionary sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

According to data from Benzinga Pro, KSS has a 52-week high of $29.60 and a 52-week low of $16.12.