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Bond Market News
Kohl’s Bonds Drop 2-4 Points on Larger than Expected Drop in Sales Forecast
March 12, 2025
Kohl’s Corp’s bonds dropped by 2-4 points after forecasting a larger than expected drop in annual sales. For 2025, Kohl’s expects a 5-7% decline in comparable sales, which is worse than the street’s expectations of a 2% drop. The company also forecast earnings of $0.1-0.6 per share, far below analysts’ expectations of $1.23 per share. Kohl’s stock price fell 24% yesterday, and has lost about 80% of its value over the past three years. The new CEO, Ashley Buchanan, warned that a turnaround would take time, amid several challenges. This drop in forecasts follows the struggles of rivals like Macy’s, Walmart, and Target, as inflation concerns and the latest recession fears have risen. Kohl’s reported a sharp drop in holiday-quarter sales due to weak demand and competition from discount retailers like TJX Cos. Buchanan, who became CEO in January, acknowledged that many of Kohl’s issues were “self-inflicted” and outlined plans to address them, including rebuilding its private-label brand and reassessing its promotional strategies. He has also implemented layoffs and store closures.
Kohl’s 4.625% 2031s fell over 4.5 points to just over 70 cents on the dollar, yielding 12%.
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