Core Viewpoint - Kohl's Inc. shares are currently trading at $20.16, reflecting a 1.85% decrease, with a notable 12.16% decline over the past month, but a significant 58.74% increase over the past year [1] Group 1: Company Performance - The stock's short-term performance is questionable, while long-term performance shows substantial growth, prompting long-term shareholders to consider the company's price-to-earnings (P/E) ratio [1] - Kohl's has a lower P/E ratio compared to the aggregate P/E of 97.16 for the Broadline Retail industry, suggesting potential undervaluation [4] Group 2: P/E Ratio Analysis - The P/E ratio serves as a tool for long-term shareholders to evaluate the company's market performance against historical earnings and industry standards [3] - A lower P/E may indicate that shareholders do not expect future growth or that the company is undervalued, highlighting the need for further analysis [4][7] - The P/E ratio should not be used in isolation; other factors such as industry trends and business cycles also influence stock prices, necessitating a comprehensive approach to investment decisions [7]

Core Viewpoint - The investment outlook for Kohl's Corp. (KSS) has improved, leading to an upgrade to a hold rating due to meaningful improvements in fundamentals, although high valuation prevents a double upgrade [1]. Group 1: Investment Strategy - The investment approach focuses on long-term investments while also incorporating short-term shorts to identify alpha opportunities [1]. - The analysis is based on bottom-up evaluation, examining the fundamental strengths and weaknesses of individual companies [1]. - The investment duration is medium to long-term, aiming to identify companies with solid fundamentals, sustainable competitive advantages, and growth potential [1].

Federal Services - Non-essential federal offices, including Social Security Administration field offices and passport agencies, will be closed on New Year's Day [2] - IRS services will also be unavailable, requiring individuals to wait until the following day for assistance [2] Financial Markets - Major U.S. exchanges, including the New York Stock Exchange and Nasdaq, will be closed for trading on New Year's Day, with operations resuming on January 2 [3][6] Mail and Delivery Services - The U.S. Postal Service will not operate on New Year's Day, with only Priority Mail Express deliveries being made [4] - FedEx and UPS will also pause operations, with limited services available for urgent shipments [5] Banking Sector - Most major banks, including Bank of America and Wells Fargo, will be closed for the holiday, although mobile banking and ATMs will remain accessible [7] Retail and Grocery - Major retailers like Walmart and Target will operate on New Year's Day, while grocery stores show a mixed picture with some chains open and others closed [8][9] - Discount grocers such as Aldi and Trader Joe's will remain closed, while convenience stores and pharmacies like CVS and Walgreens will generally stay open [10] Restaurants - Fast-food chains, including McDonald's and Starbucks, will have many locations open, although hours may vary by franchisee [12]

Core Viewpoint - Investors are increasingly focusing on heavily shorted stocks, either to capitalize on further declines in value or to benefit from potential short squeezes [1][3]. Group 1: Characteristics of Heavily Shorted Stocks - A stock is considered "heavily shorted" when a significant number of traders and institutional investors believe it is fundamentally overvalued, leading to expectations of a price decline [2]. - High short interest often indicates a strong conviction among professional traders that the company faces serious risks, while retail traders may see it as an opportunity for rapid gains through a short squeeze [3]. Group 2: Short Squeeze Dynamics - A short squeeze occurs when a stock's price unexpectedly rises, forcing short sellers to buy back shares to cover their positions, which creates a spike in demand and further drives up the price [4]. - The volatility associated with a short squeeze can result in returns that significantly exceed typical stock movements within a short time frame [4]. Group 3: Most Heavily Shorted Stocks - As of December 29, the following stocks are the most heavily shorted, with market caps above $2 billion and free floats above 5 million: - Lucid Group, Inc. (NASDAQ:LCID) - 54.51% - Choice Hotels International, Inc. (NYSE:CHH) - 50.20% - Avis Budget Group, Inc. (NASDAQ:CAR) - 48.80% - Revolve Group, Inc. (NYSE:RVLV) - 43.14% - Medical Properties Trust, Inc. (NYSE:MPW) - 37.13% - MARA Holdings, Inc. (NASDAQ:MARA) - 36.23% - Hims & Hers Health, Inc. (NYSE:HIMS) - 35.22% - TransMedics Group, Inc. (NASDAQ:TMDX) - 35.11% - Kohl's Corporation (NYSE:KSS) - 34.27% - Northern Oil & Gas, Inc. (NYSE:NOG) - 33.27% [5][6].

Group 1: Pricing Strategies - Apple limits discounts to once or twice a year to maintain the perception of value and encourage full-price purchases [1] - Ron Johnson's overhaul of JC Penney aimed to eliminate discounts in favor of a 'fair and square' pricing model, which ultimately failed due to poor consumer response [2][3] - The removal of discounts can alienate a retailer's core fan base, as seen in the struggles of JC Penney under Johnson's leadership [3] Group 2: Kohl's Cash Program - Kohl's Cash is earned during promotions, providing $10 for every $50 spent on qualifying items, and can be redeemed like cash during specified periods [5][7] - The Kohl's Cash program is popular and has been maintained despite industry challenges, contrasting with other retailers that have altered their discount strategies [4] - Kohl's Rewards members earn additional Kohl's Cash on all purchases, enhancing the savings potential for consumers [7]

Core Viewpoint - Kohl's stock has surged 64% this year, but its long-term performance shows a 42% decline over five years, underperforming the S&P 500's 83% gain in the same period [1][9] Financial Performance - Kohl's offers a dividend yield of 2.18%, but narrow profit margins limit future dividend growth, and the company cut its dividend by 75% earlier this year [2] - The company anticipates a net sales drop of 3.5% to 4% for the full year, with analysts expecting comparable sales to decline by 2.5% to 3% year over year [7] - Kohl's reported $73 million in Q3 operating income but spent $75 million on interest, resulting in a positive net income only due to a one-time tax provision of $10 million [12] Competitive Landscape - Kohl's faces intense competition from retail giants like Walmart, Costco, and Target, which offer a wider range of products, including clothing, making it difficult for Kohl's to attract customers [6] - The company's low profit margins, typically below 1%, limit its ability to absorb rising costs or tariffs [7] Balance Sheet Analysis - Kohl's has $4.3 billion in current assets, but $3.9 billion of that is tied up in merchandise inventories, leading to a low quick ratio of 0.12, indicating minimal cash reserves [10] - The total assets of Kohl's dropped by 6% year over year, reflecting a deteriorating financial situation [11] Investment Outlook - Despite the recent stock rally, the fundamentals suggest that Kohl's is struggling to maintain profitability and may be viewed as a sinking ship in the long run [13]

Core Viewpoint - Kohl's (KSS) has reached a significant support level and shows potential for investors from a technical perspective, with a recent breakthrough of the 20-day moving average indicating a short-term bullish trend [1]. Technical Analysis - The 20-day simple moving average is a widely used trading tool that smooths out price fluctuations and provides trend reversal signals, making it beneficial for short-term traders [1][2]. - A stock price above the 20-day moving average indicates a positive trend, while a price below suggests a downward trend [2]. Performance Metrics - Over the past four weeks, KSS has gained 51.1%, and it currently holds a Zacks Rank 2 (Buy), suggesting further upward movement potential [4]. - In the last two months, there have been no lowered earnings estimates for KSS, with five estimates raised for the current fiscal year, leading to an increase in the consensus estimate [4]. Investment Outlook - The combination of positive earnings estimate revisions and favorable technical indicators suggests that KSS may present additional gains for investors in the near future [5].

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point, as stocks may lose momentum when their valuations exceed future growth potential [2] - Investing in bargain stocks that exhibit recent price momentum can be a safer strategy, utilizing tools like the Zacks Momentum Style Score to identify promising stocks [3] Group 2: Kohl's (KSS) Performance - Kohl's (KSS) has shown significant price momentum, with a four-week price change of 45.6%, indicating growing investor interest [4] - Over the past 12 weeks, KSS has gained 31.1%, with a beta of 1.45, suggesting it moves 45% more than the market [5] - KSS has a Momentum Score of A, indicating a favorable time to invest based on its momentum characteristics [6] Group 3: Earnings Estimates and Valuation - KSS has benefited from upward revisions in earnings estimates, earning a Zacks Rank 2 (Buy), which is associated with strong momentum effects [7] - The stock is currently trading at a Price-to-Sales ratio of 0.16, suggesting it is undervalued at 16 cents for each dollar of sales [7] Group 4: Additional Investment Opportunities - Besides KSS, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - The Zacks Premium Screens offer various strategies tailored to different investing styles, potentially aiding in stock selection [9]

Group 1 - Jefferies raised the target price for Kohl's from $20 to $24 while maintaining a "Hold" rating [1] - Kohl's stock experienced a significant increase, rising nearly 8% after Q1 earnings exceeded expectations [1] - The stock further surged by 13.95% amid news of two companies planning to propose a takeover [1]

Core Insights - Some shoppers are highly focused on maximizing returns from retailer rewards programs, indicating a trend towards consumer engagement with loyalty incentives [1] Group 1 - The obsession with rewards programs suggests that retailers may need to enhance their offerings to retain customer interest and loyalty [1] - This behavior reflects a broader consumer trend where maximizing value from purchases is prioritized, potentially influencing shopping habits and retailer strategies [1]