Kohl's Reports Mixed Earnings for Q2, Rose 3.6% YoY

August 12, 2011

Kohl's (NYSE:KSS) reported Q2 EPS of $1.09, better than analyst estimates $1.02 per share. Revenues for the quarter rose 3.6% year-over-year to $4.20 billion, missing the consensus estimates of $4.31 billion.For the third quarter, Kohl's expects total sales to increase between 4 and 6 percent; comparable store sales to increase 2 to 4 percent.Kevin Mansell, Kohl's chairman, president and chief executive officer, said, "I am extremely pleased with our ability to deliver strong earnings growth in a challenging sales environment. Our gross margin rate increased significantly over second quarter of last year as a result of our increased penetration of private and exclusive brands and disciplined inventory management. Prudent expense management across many of our areas, especially in stores, allowed us to achieve lower-than-planned expense growth. We continue to benefit from strong profitability in our credit card partnership with Capital One as bad debt expenses declined significantly over last year."Kohl's (NYSE:KSS) has a potential upside of 47.1% based on a current price of $44.29 and an average consensus analyst price target of $65.13.