Let’s dig into the relative performance of Kohl's (NYSE:KSS) and its peers as we unravel the now-completed Q1 general merchandise retail earnings season.
General merchandise retailers–also called broadline retailers–know you’re busy and don’t want to drive around wasting time and gas, so they offer a one-stop shop. Convenience is the name of the game, so these stores may sell clothing in one section, toys in another, and home decor in a third. This concept has evolved over time from department stores to more niche concepts targeting bargain hunters or young adults, and e-commerce has forced these retailers to be extra sharp in their value propositions to consumers, whether that’s unique product or competitive prices.
The 8 general merchandise retail stocks we track reported a mixed Q1. As a group, revenues beat analysts’ consensus estimates by 1% while next quarter’s revenue guidance was 1.5% below.
In light of this news, share prices of the companies have held steady as they are up 2.2% on average since the latest earnings results.
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 $3.23 billion, down 4.4% year on year. This print exceeded analysts’ expectations by 1%. Overall, it was a strong quarter for the company with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ gross margin estimates.
Michael Bender, Kohl’s Interim Chief Executive Officer, said, “I am honored to assume the role of Interim CEO at such an important time for our company. Kohl’s has a tremendous opportunity to build on our strong foundation of over 1,100 conveniently located stores and a large and loyal customer base.”
Kohl's delivered the slowest revenue growth of the whole group. Interestingly, the stock is up 7.8% since reporting and currently trades at $8.76.
Is now the time to buy Kohl's? Access our full analysis of the earnings results 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 $1.55 billion, down 1.6% year on year, in line with analysts’ expectations. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ EPS estimates.
The market seems content with the results as the stock is up 3.7% since reporting. It currently trades at $402.51.
Is now the time to buy Dillard's? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Burlington (NYSE:BURL)
Founded in 1972 as a discount coat and outerwear retailer, Burlington Stores (NYSE:BURL) is now an off-price retailer that has broadened into general apparel, footwear, and home goods.
Burlington reported revenues of $2.50 billion, up 6% year on year, falling short of analysts’ expectations by 0.9%. It was a slower quarter as it posted EPS guidance for next quarter missing analysts’ expectations.
Burlington delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 3% since the results and currently trades at $246.02.
Read our full analysis of Burlington’s results here.
Ross Stores (NASDAQ:ROST)
Selling excess inventory or overstocked items from other retailers, Ross Stores (NASDAQ:ROST) is an off-price concept that sells apparel and other goods at prices much lower than department stores.
Ross Stores reported revenues of $4.98 billion, up 2.6% year on year. This result surpassed analysts’ expectations by 0.5%. Zooming out, it was a slower quarter as it logged EPS guidance for next quarter missing analysts’ expectations.
The stock is down 5.4% since reporting and currently trades at $143.94.
Read our full, actionable report on Ross Stores here, it’s free.
Ollie's (NASDAQ:OLLI)
Often located in suburban or semi-rural shopping centers, Ollie’s Bargain Outlet (NASDAQ:OLLI) is a discount retailer that acquires excess inventory then sells at meaningful discounts.
Ollie's reported revenues of $576.8 million, up 13.4% year on year. This number topped analysts’ expectations by 1.9%. It was a strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and a decent beat of analysts’ gross margin estimates.
The stock is up 6.9% since reporting and currently trades at $119.73.
Read our full, actionable report on Ollie's here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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