Kohl's (KSS) Stock Forecast & Price Target

Kohl's reported a fourth-quarter gross margin expansion of 20 basis points year-over-year to 33.1%, reflecting effective inventory management and better control of expenses despite rising shipping costs associated with increased digital sales. The company's operating margin also improved to 4.1%, exceeding both internal estimates and consensus expectations, driven by strong performance in its selling, general, and administrative expenses. Additionally, Kohl's ended the quarter with significantly higher cash reserves of $674 million compared to $134 million the previous year, indicating a solid liquidity position that supports future growth strategies.

Kohl's is expected to face continued challenges, with projected fiscal year 2026 earnings per share (EPS) decreasing to $1.40, a drop from $1.62 in fiscal year 2025 and below the previous consensus estimate of $1.37. The company is anticipated to experience a contraction in sales for 2026, accompanied by margin pressure and a year-over-year decline in EPS, highlighting a persistent negative trajectory despite management's guidance. Additionally, Kohl's reported disappointing fourth-quarter results, with total sales and comparable store sales declining sequentially, reflecting ongoing difficulties in attracting and retaining customers.