Department store Kohl’s Corporation (KSS) posted negative same-store sales results for the month of May compared with the prior-year period. The total sales for the period also decreased, due to lower inventory levels.
Amid a challenging sales environment, Kohl’s comparable store sales was negative 4.2% for the four-weeks ended May 26, 2012, versus a positive 0.8% same-store sales growth in the four-week month ended May 28, 2011. Kohl’s total sales dipped 2.6% in the month of May 2012 to $1.34 billion, as compared to 2.5% growth with sales of $1.37 billion in the year-ago month.
Kohl’s, which reported its first quarter 2012 earnings on May 10, posted 1.9% increase in net sales to $4.243 billion in the quarter. However, the results slightly missed the Zacks Consensus Sales Estimate of $4.256 billion. Kohl’s same-store sales for the quarter ending April 28 increased 0.2%, while total sales climbed 1.9%, driven by accessories and home divisions along with positive response in men's items.
During the first quarter conference call, Kohl’s stated that it expects sales to increase in the range of 2% to 3% and comparable store sales to increase in the range of flat to 1% for the second quarter 2012. However, the company’s negative same store sales in the month of May might lead to negative same-store sales for the second quarter of 2012.
On the other hand, Kohl’s competitor, Ross Stores Inc. (ROST) reported growth in same-store sales for the four weeks ended May 26, 2012 of 8%, up from the 4% growth in the month of May 2011. Net sales for the month marked an increase of 13% to $746 million from $661 million reported in the prior year period.
Kohl’s, which operates 1,134 stores in 49 states, holds a Zacks #3 Rank (short-term Hold rating). Currently, we maintain a long-term Neutral recommendation on the stock.Read the Full Research Report on KSS
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