URBN - Retail Sector Q3 Earnings Insight: Kohl's American Eagle Outfitters And Urban Outfitters On The Radar | Benzinga
Telsey Advisory Group analyst Dana Telsey has analyzed the third-quarter FY23 earnings season for major retailers.
Kohl's Corp (NYSE: KSS)- Maintain Market Perform Rating, $29 Price Target
KSS reported third-quarter EPS of $0.53 (versus $0.82 last year), coming in ahead of the consensus expectation of $0.35. The beat was driven entirely by better-than-expected gross margin expansion.
The gross margin expansion was driven by lower freight costs and digital related shipping expenses, as well as the simplification of value strategies, writes the analyst.
In Q3, KSS saw total beauty sales growth of over 70%, with 30% plus comps from the Sephora shops opened in 2021 and 2022, indicating a sustained momentum from Sephora.
That said, the topline results disappointed in the quarter, and expenses, though well-maintained, deleveraged more-than-anticipated, reflecting continued investments in Sephora openings and wage pressure, notes the analyst.
The analyst says ...