Deutsche Bank Downgrades Kohl's to "Sell" (KSS)

Deutsche Bank Downgrades Kohl’s to “Sell” (KSS)


Deutsche Bank reported on Friday that it has downgraded discount retailer, Kohl’s Corporation (KSS) to “Sell.”

The firm had lowered its rating of KSS from “Hold” to “Sell,” and has reduced the company’s price target from $42 to $41. This price target suggests a -11% decline from the stock’s current price of $46.43.

Analysts have downgraded Kohl’s based on its low traffic and large amount of inventory.

Deutsche Bank analyst Paul Trussell commented, “we are downgrading KSS to Sell from Hold as weakening traffic (share losses to off-price, less share donation from JCP, cold weather) and a heavy inventory position (according to our channel checks) could lead to incremental promotions and greater than expected markdowns, pressuring margins.”

“With a FY13 EPS range reliant on a return to GPM expansion, we believe current forecasts are likely too high and we are positioned at the low-end of the forecast (with risk to the downside) as a result.”

Kohl’s shares were mostly flat during premarket trading Friday. The stock has declined -8% in the past year.

The Bottom Line
Shares of Kohl’s Corporation (KSS) have a 3.02% yield, based on Thursday’s closing price of $46.43.

Kohl’s Corporation (KSS) is not recommended at this time, holding a DARS™ Rating of 3.3 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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