By Christiana Sciaudone
Investing.com — Store closures and retail bankruptcies are defining 2020. Kohl’s (NYSE:KSS) is defying the status quo.
Shares are up 7.9% after the company said margins will increase and it will introduce its own athleisure brand, FLX, in 2021 as work-from-home trends take over our lives.
Margins will benefit from restructuring in 2020, on top of cost savings of more than $250 million in the previous two years, as well as a reduction in labor costs and more digital than print marketing. The 6.1% margin of 2019 should increase to between 7% and 8%.
The active segment has seen a compound annual growth rate of 10% over the past three years, Kohl’s said in a statement. Kohl’s will also offer more sizes to address an underserved market with high-growth opportunity.
Most analysts have yet to be swayed. Just a single firm says buy; seven say hold; and three say sell.
Among its department store peers that have filed for bankruptcy in 2020 are Century 21, JCPenney and Neiman Marcus, according to CB Insights.
In its most recent earnings, Kohl’s reported a loss per share of 25 cents compared to the expected 88 cents. Sales of $3.21 billion beat the estimated $3.09 billion.
Shares are down almost 60% since January.
Kohl’s Defies Retail Reaper, Launching Its Own Athleisure Brand
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