Kohl's (KSS) Stock Forecast & Price Target

Kohl's experienced a significant increase in impulse sales, which rose 30% year-over-year for the quarter, indicating strong consumer engagement and a positive buying environment. The company's sales trends demonstrated consistent improvement throughout the quarter, reflecting effective merchandising strategies and operational execution. Additionally, the relationship between proprietary brand penetration and gross margin enhancement suggests that further growth in this segment could lead to substantial profitability improvements, as a 100 basis points increase in proprietary brands could enhance gross margins by 10-15 basis points.

Kohl's is facing a challenging financial outlook, as the company's Selling, General, and Administrative (SG&A) expenses are projected to decline by 4%-4.5% year-over-year, indicating potential efficiency issues amidst declining sales. Additionally, inventory levels are expected to decrease moderately year-over-year by the end of fiscal year 2025, suggesting potential difficulties in inventory management and demand forecasting. The company's performance in key categories such as men's and kids' apparel, along with softer footwear sales, highlights underlying weaknesses that may further strain overall revenue and profitability.