Kohl's Corp. (KSS) stock soared 5.01% in pre-market trading on Monday, despite unfavorable analyst actions and general negative sentiment surrounding the retailer's performance and business model.
Guggenheim downgraded Kohl's rating to "Neutral" from "Buy", citing deteriorating traffic, slumping comparable sales, and declining cash flow generation. The brokerage firm noted increasing promotional competition, worsening apparel sales trends, and challenging dynamics in the department store sector as risks facing Kohl's.
Additionally, analysts and experts have raised concerns about Kohl's ability to compete with low-cost retailers like Walmart and TJ Maxx, as well as specialized stores offering higher-quality products in categories such as electronics and furniture. The traditional department store model is seen as struggling to adapt to changing consumer preferences and the rise of online shopping.
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