Kohl’s (KSS) had a stellar performance in Q3, with its shares soaring over 40% higher on Nov. 25 after the department store chain reported strong earnings and raised its guidance for the full year. This positive news came on the heels of the announcement that Michael Bender had been named the permanent CEO of Kohl’s, a position he had been serving in on an interim basis since May.
The market responded favorably to Kohl’s quarterly release, with the stock up more than 280% from its year-to-date low. This surge reflects investor confidence in Bender’s leadership and the company’s turnaround strategy, which is focused on reintroducing value-focused categories and comprehensive discounts to attract lower- and middle-income consumers in the face of economic uncertainty.
Kohl’s revised outlook for a 4% sales decline this year, compared to at least 5% previously forecasted, indicates that the company’s efforts to prioritize customer loyalty and affordability are gaining traction. Bender acknowledged the progress made in the earnings release but emphasized that there is still room for improvement, signaling confidence in continued momentum moving forward.
Despite the significant increase in its stock price since early April, Kohl’s shares still offer value for investors, as the company is trading at a discount to its book value. According to its latest annual filing, Kohl’s land and buildings have a book value of $9.44 billion, which is higher than its current enterprise value.
In addition to its potential for capital appreciation, KSS stock also offers a dividend yield of 2.3%, making it an attractive option for income-focused investors. From a technical perspective, Kohl’s stock is trading above its major moving averages, indicating a strong uptrend heading into 2026.
Prior to the Q3 earnings release, Wall Street had a consensus “Moderate Sell” rating on Kohl’s stock. However, the positive results and optimistic outlook have likely prompted analysts to reassess their stance on the company.
In conclusion, Kohl’s impressive performance in Q3 and the strategic initiatives implemented under Bender’s leadership make it a compelling investment opportunity. The company’s focus on value and customer loyalty, coupled with its attractive valuation and dividend yield, position Kohl’s as a strong contender in the retail sector. Investors looking for long-term growth potential should consider adding KSS shares to their portfolio.
