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Q1 Earnings Highs And Lows: Kohl's (NYSE:KSS) Vs The Rest Of The Department Store Stocks


Petr Huřťák /
2024/06/11 2:46 am EDT

As the Q1 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers in the department store industry, including Kohl's (NYSE:KSS) and its peers.

Department stores emerged in the 19th century to provide customers with a wide variety of merchandise under one roof, offering a convenient and luxurious shopping experience. They played an important role in the history of American retail and urbanization, and prior to department stores, retailers tended to sell narrow specialty and niche items. But what was once new is now old, and department stores are somewhat considered a relic of the past. They are being attacked from multiple angles–stagnant foot traffic at malls where they’ve served as anchors; more nimble off-price and fast-fashion retailers; and e-commerce-first competitors not burdened by large physical footprints.

The 4 department store stocks we track reported a strong Q1; on average, revenues beat analyst consensus estimates by 2.6%. Stocks--especially those trading at higher multiples--had a strong end of 2023, but 2024 has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts, and department store stocks have had a rough stretch, with share prices down 6.2% on average since the previous earnings results.

Weakest Q1: Kohl's (NYSE:KSS)

Founded as a corner grocery store in Milwaukee, Wisconsin, Kohl’s (NYSE:KSS) is a department store chain that sells clothing, cosmetics, electronics, and home goods.

Kohl's reported revenues of $3.38 billion, down 5.3% year on year, in line with analysts' expectations. It was a weaker quarter for the company, with underwhelming earnings guidance for the full year and a miss of analysts' earnings estimates.

Tom Kingsbury, Kohl’s chief executive officer, said, “Our first quarter results did not meet our expectations and are not reflective of the direction we are heading with our strategic initiatives. Regular price sales increased year-over-year, with early success in underpenetrated categories, positive trends in our Women’s business, and continued strong growth in Sephora. However, lower clearance sales versus last year represented a more than 600 basis point drag on comparable sales. Importantly, we were able to deliver gross margin expansion, manage inventory down 13% and tightly control expenses in the quarter.”

Kohl's Total Revenue

Kohl's delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The stock is down 16.1% since the results and currently trades at $22.88.

Read our full report on Kohl's here, it's free.

Best Q1: Dillard's (NYSE:DDS)

With stores located largely in the Southern and Western US, Dillard’s (NYSE:DDS) is a department store chain that sells clothing, cosmetics, accessories, and home goods.

Dillard's reported revenues of $1.57 billion, down 2.5% year on year, outperforming analysts' expectations by 1.5%. It was an impressive quarter for the company, with a solid beat of analysts' earnings estimates.

Dillard's Total Revenue

The stock is down 6.9% since the results and currently trades at $424.09.

Is now the time to buy Dillard's? Access our full analysis of the earnings results here, it's free.

Nordstrom (NYSE:JWN)

Known for its exceptional customer service that features a ‘no questions asked’ return policy, Nordstrom (NYSE:JWN) is a high-end department store chain.

Nordstrom reported revenues of $3.34 billion, up 4.8% year on year, exceeding analysts' expectations by 4.3%. It was a mixed quarter for the company, with optimistic earnings guidance for the full year but a miss of analysts' earnings estimates.

Nordstrom scored the biggest analyst estimates beat and fastest revenue growth in the group. The stock is up 0.9% since the results and currently trades at $21.21.

Read our full analysis of Nordstrom's results here.

Macy's (NYSE:M)

With a storied history that began with its 1858 founding, Macy’s (NYSE:M) is a department store chain that sells clothing, cosmetics, accessories, and home goods.

Macy's reported revenues of $5 billion, down 3.3% year on year, surpassing analysts' expectations by 3.9%. It was a very strong quarter for the company, with an impressive beat of analysts' earnings estimates and optimistic earnings guidance for the full year.

The stock is down 2.7% since the results and currently trades at $18.6.

Read our full, actionable report on Macy's here, it's free.

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