Kohl's fair value estimate rose to $15.61 from $14.92 as analysts cite improved expense and inventory management, a better-than-expected quarter, and incremental progress on self-help initiatives, even with lingering sales challenges.

Analyst Commentary

Analysts have responded to Kohl's recent quarterly results and guidance updates with a range of perspectives, reflected in higher price targets and updated ratings. Their commentary highlights the areas in which the company is making progress, as well as lingering concerns about future growth and execution.

• Multiple analysts raised their price targets, citing improved expense discipline and tighter inventory management, which contributed to a better than expected quarter.
• Bullish analysts point to incremental progress on self-help initiatives. They note that Kohl's is implementing more operational improvements than previously anticipated.
• Upward revisions to earnings per share estimates for the next two fiscal years reflect increased confidence in Kohl's medium-term outlook, especially if recent sales momentum can be sustained.
• Some upgraded their overall outlook and attribute the changes to stronger guidance for the full year and the company's proactive approach to addressing operational challenges.

• Despite a favorable quarter, sales trends remained weak and overall traffic declined. This signals persistent demand challenges that need to be addressed for sustained growth.
• Bearish analysts remain cautious on the sector and emphasize that more concrete evidence of a turnaround is needed before fully committing to a more optimistic view.
• Concerns persist around Kohl's ability to re-engage its core customer base. Some note that continued weakness among this group could hinder a broader recovery.
• Valuation adjustments, though positive, were sometimes tempered by ongoing sector headwinds and skepticism around the longevity of recent improvements.

What's in the News

• Evercore ISI raised its price target on Kohl's to $13 from $8, citing a solid quarter and increased self-help initiatives, even as store traffic declined 4% in Q2 (Evercore ISI).
• Kohl's is asking certain vendors for additional time to settle invoices as part of its ongoing turnaround efforts, according to sources cited by Bloomberg (Bloomberg).
• Kohl's launched FLX apparel for kids. This expands its proprietary brand portfolio with a new activewear and athleisure line that is now available in 300 stores, with plans to expand further in 2026 (Company Statement).
• The company raised its full-year 2025 earnings guidance, projecting net sales to decrease 5% to 6% and comparable sales to decrease 4% to 5% (Company Guidance).

Valuation Changes

• Fair Value Estimate increased from $14.92 to $15.61, reflecting improved outlook from recent results.
• Discount Rate rose slightly from 12.32% to 12.5%, indicating a modest increase in perceived risk or required return.
• Revenue Growth projection declined further, from -1.52% to -1.60%. This suggests ongoing challenges to sales expansion.
• Net Profit Margin outlook edged up very slightly, from 1.31% to 1.32%.
• Future Price-to-Earnings (P/E) multiple increased from 12.09x to 12.71x. This reflects improved earnings expectations.