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Kohl's (KSS) Stock Is Down 30% In March - What's Behind The Selloff?
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Kohl's (KSS) Stock Is Down 30% In March - What's Behind The Selloff?
Mar 19, 2025 7:24 AM

Kohl's Corp (NYSE:KSS) shares have dropped by around 30% to $8.33 in March following a disappointing earnings report that revealed a 9.4% drop in fourth-quarter net sales. The company also issued a cautious outlook, forecasting a 4-6% decline in comparable sales for fiscal year 2025.

What Happened: Kohl’s shares tumbled last week after reporting fourth-quarter FY24 revenue of $5.175 billion, down 9.4% from the previous year.

Despite slightly exceeding Wall Street's estimate of $5.145 billion, comparable sales fell 6.7%, reflecting weaker consumer demand. Operating income took a significant hit, declining from $299 million in the prior year to $126 million.

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While the retailer managed a 49-basis-point improvement in gross margin to 32.9%, operating margin dropped to just 2.3%, highlighting growing profitability concerns.

Dividend Cut and Future Outlook: Adding to investor worries, Kohl's announced a cut to its quarterly dividend, slashing it from 50 cents per share to 12.5 cents. The company ended the quarter with $134 million in cash and $2.9 billion in inventory, marking a 2% year-over-year increase.

Looking ahead, Kohl's issued a disappointing FY25 forecast, projecting a 5%-7% sales decline and an EPS range of 10 cents to 60 cents, far below Wall Street's consensus of $1.25.

Analyst Sentiment: Analysts remain skeptical about Kohl's turnaround strategy, citing ongoing challenges in stabilizing the business amid an uncertain macroeconomic environment.

Persistent inflationary pressures, shifting consumer spending habits and heightened retail competition continue to weigh on the company's growth prospects.

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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 $7.96.

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