What Happened: Shares of department store chain Kohl’s (NYSE:KSS) jumped 6.4% in the afternoon session after Reuters reported that an activist hedge fund chaired by former Canadian Prime Minister Stephen Harper, is pushing the company to consider selling itself amid concerns about its future. According to sources, Vision One Management Partners, co-founded by Harper, has acquired a stake in Kohl's (NYSE:KSS) and is pressuring the company for a sale process and board representation. After the initial pop the shares cooled down to $26.77, up 4.7% from previous close.
Is now the time to buy Kohl's? Find out by reading the original article on StockStory.
What is the market telling us: Kohl's's shares are quite volatile and over the last year have had 40 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 3 months ago, when the company gained 9.1% as retail stocks surged after bellwether Target reported third quarter results that blew past analysts' EPS expectations, driven by a small beat on revenue, better profitability, and a lower-than-expected tax rate. While same-store sales declined, the figure exceeded analysts' expectations. The company also generated healthy operating cash flows and repositioned its inventory into a healthier position. Next quarter's EPS guidance was slightly ahead of Consensus. Zooming out, we think Target’s quarter was an impressive one that should please shareholders, especially in light of some troubling consumer commentary from other companies.
Kohl's is down 4.6% since the beginning of the year, and at $26.77 per share it is trading 22.5% below its 52-week high of $34.55 from February 2023. Investors who bought $1,000 worth of Kohl's's shares 5 years ago would now be looking at an investment worth $400.40.