Kohl's beats across the board and raises guidance
- Kohl's first-quarter earnings beat on both the top and bottom lines.
- Comparable sales increased 3.6%, surpassing the 2.7% estimate.
- Kohl's raised its full year 2018 guidance.
- Shares rise more than 5% before the opening bell.
- Watch Kohl's trade in real-time here.
The mall-based retailer reported earnings of $0.64, easily surpassing the $0.50 that analysts surveyed by Bloomberg were anticipating. Kohl's revenue came in at $4.2 billion compared to the $3.96 billion that was expected. It also reported same store sales of 3.6%, surpassing the 2.7% estimate.
"We are very pleased with our strong start to fiscal 2018 as we continued to focus on our priorities of driving traffic and operational excellence," CEO Michelle Gass said in the earnings release. "We built on our recent momentum and achieved our third consecutive quarter of positive comparable sales, which increased on both a fiscal and a shifted basis."
The department store has thrived at a time where its peers like Sears and JC Penney have struggled to keep sales growth. Its success, depends heavily on the store's strategy and location. Nine out of 10 Kohl's stores are located in suburban strip malls rather than traditional shopping malls, making the company more resistant to dwindling mall traffic across the US.
The retailer is also shrinking some stores rather than closing them down completely which helps with comp sale numbers. Teaming up with Aldi for test locations and Amazon for product returns have also helped the store in recent months.
The company boosted fiscal year 2019 earnings guidance to $5.05-$5.50 per share from the previous $4.95-$5.45.
Kohl's is up more than 22% this year.
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