Specialty department store
) posted increase in total sales and same-store sales results for
the month of January compared with the prior-year period, where
all lines of business except Footwear category achieved
double-digit comparable store sales increases.
Excluding the sales for the fifth week of Jan 2013, Kohl's
comparable store sales increased 13.3% for the four-weeks ended
Jan 26, 2013 versus a same-store sales growth of just 0.6% in the
four-week month ended Jan 28, 2012. Kohl's total sales, excluding
the additional week of fiscal 2013, increased 14.1% in the month
of Jan 2013 to $1.13 billion compared with 2.4% growth to $0.84
billion in the year-ago month. E-commerce sales also increased
59% over Jan 2012.
The January sales performance was impressive as the company
was able to clear out its seasonal merchandise last month. The
company witnessed strong performance in the Western region with a
mid-teen increase in comparable store sales, whereas the South
Central region reported a low double-digit increase in comparable
store sales. All other regions reported mid-to-high single-digit
Where the company managed to clear out its merchandises in
January, it could not generate sufficient sales during the
holiday season, as expected by the company. Kohl's performance
during the holiday season was impacted by unfavorable weather
conditions and lower consumer confidence, which forced Kohl's to
give more-than-expected discounts to its customers.
This was reflected in December comparable store sales, which
were lower than the company's expectations. Notably, the
company's November sales were also below expectations.
The sluggish sales also prompted the company to slash its
expectations for the fourth quarter and fiscal year 2012, results
of which are scheduled to release on Feb 28. The company has
reduced its earnings expectation to a range of $1.60 to $1.62 for
the fourth quarter and $4.11 to $4.13 for fiscal 2012 versus its
previous guidance of $2.00 to $2.08 for the fourth quarter and
$4.52 to $4.60 for fiscal 2012.
Estimates for Kohl's have also been declining ever since it
reported its December comparable sales. With the Zacks Consensus
Estimates for both fiscal 2013 and 2014 going down, the company
now has a Zacks Rank #5 (Strong Sell).
Though the company reported favorable comp sales in January,
we still prefer to avoid Kohl's until we see signs of improvement
in the company's overall performance. Some other retail stocks
reporting favorable comp sales in January include
) with comp sales growth of 11.7%,
) reporting comp sales growth of 11.4% and
) with comp sales growth of 8%.
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