Kohl’s Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Kohl’s (NYSE:KSS) will unveil its latest earnings on Thursday, August 9, 2012. Kohl’s operates department stores that offer apparel, footwear and accessories as well as home products and housewares.

Kohl’s Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 95 cents per share, a decline of 12.8% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from $1.15. Between one and three months ago, the average estimate moved down. It has been unchanged at 95 cents during the last month. Analysts are projecting profit to rise by 8.6% compared to last year’s $4.67.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by 3 cents, reporting net income of 63 cents per share against a mean estimate of profit of 60 cents per share.

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A Look Back: In the first quarter, profit fell 27% to $154 million (63 cents a share) from $211 million (73 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 1.9% to $4.24 billion from $4.16 billion.

Stock Price Performance: Between June 7, 2012 and August 3, 2012, the stock price had risen $7.14 (16.2%), from $43.97 to $51.11. The stock price saw one of its best stretches over the last year between May 17, 2012 and May 29, 2012, when shares rose for eight straight days, increasing 9.1% (+$4.22) over that span. It saw one of its worst periods between December 28, 2011 and January 9, 2012 when shares fell for eight straight days, dropping 8.1% (-$4.08) over that span.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.68 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.84 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 11.5% to $2.89 billion while assets rose 1.5% to $4.85 billion.

Key Stats:

After experiencing income drops the past two quarters, the company is hoping to use this earnings announcement to rebound. Net income dropped 7.3% in the fourth quarter of the last fiscal year and then again in the first quarter.

On the top line, the company is hoping to build on a revenue increase last quarter. Revenue fell 0.3% in the fourth quarter of the last fiscal year after increasing in the first quarter.

Analyst Ratings: With 10 analysts rating the stock a buy, none rating it a sell and eight rating the stock a hold, there are indications of a bullish stance by analysts.

Wall St. Revenue Expectations: On average, analysts predict $4.23 billion in revenue this quarter, a decline of 0.5% from the year-ago quarter. Analysts are forecasting total revenue of $19.41 billion for the year, a rise of 3.2% from last year’s revenue of $18.8 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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