Department Stores Comparison: Kohl's Is A Winner

Sep. 08, 2020 3:51 PM ETKohl's Corporation (KSS)DDS, CPPRQ, JWN, M16 Comments
Patrik Mackovych profile picture
Patrik Mackovych


  • A full analysis covering department store companies, Macy's, Kohl's, Nordstrom, and Dillard's.
  • The main objective is to choose a company that is the safest and has the best probability of surviving the long-term competitive challenge.
  • This analysis provides a detailed financial and profitable comparison of the above-mentioned companies.
  • According to our scoring system, Kohl's Corporation is the clear winner with stable financial conditions, profitability and the best adaptation in crisis.

The department store companies have recently been through hard times, and the future is not promising. I decided to carry out a financial and profitability comparison of some big-name stores like Macy's Inc. (M), Kohl's Corporation (NYSE:KSS), Nordstrom Inc. (JWN), and Dillard's Inc. (DDS). These companies are experiencing financial distress because of one giant company, Amazon (AMZN), who is taking the lead in terms of market share; their market share is declining because of this. The gap in the market left by J. C. Penney Company and other bankrupted retailers give the above-mentioned companies a larger market share. Based on our analysis, if new lockdowns come, Nordstrom would have the biggest probability of bankruptcy. Anyway, Kohl's should be the strongest one from the comparison.

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In my last article on Macy's and the spending analysis in the Apparel and General Merchandise sector, I concluded that Macy's could be highly undervalued. These measures could be applied to all department stores companies mentioned. The market is pricing it very badly, and the sell-off is unreasonable. But when we adjust the stock price and look for the financial earnings data, we need to ascertain which company is the safest and has tremendous upside potential.

Two general bullish narratives

The first bullish narrative that we can apply to all department store companies is that of the robust spending data in the USA. There are differences in various states, but we could use the same principle for our analysis, as used in the previous article.

The second narrative is the bankruptcy filings for many smaller retailers and J. C. Penney. I will not elaborate on J. C. Penney's business at this point. It is over, and the company will have to offer huge discounts on its products to get rid of its inventory, other assets to fulfill the liquidation process; this should

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This article was written by

Patrik Mackovych profile picture
I graduated from the University of Economics in Bratislava and successfully passed the Finance, Banking, and Investments program with a Bachelor's degree. In the case of a Master's degree, I have been studying banking. I worked as a macroeconomic analyst in the biggest bank in Slovakia (Slovenska sporitelna). I focus on macroeconomics, mainly on monetary policy and the financial market. Currently, I´m working as Investment Analyst. I am keen on analyzing various companies and creating my investing strategies and ideas.

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in KSS, M, DDS over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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