Takeaway: Newsflash: KSS has changed...Black Book quantifying every factor to gauge smoke vs reality.

We’re going deep on the ‘what’s changed’ part of the KSS story. This is not a pound the table ‘the market is wrong’ call. Simply put, the story has changed – per the 60% rally since the November print. 

  • The question that needs to be answered is duration, what the PERCEIVED best case earnings power is, and when the market (and KSS management) begins to believe the real underlying economic reality. 
  • To be clear, the REAL earnings power has not changed despite the solid holiday comp (in one of the best Retail macro climates this cycle). That will matter at a point. It’s our job to quantify all the puts and takes on the bull vs bear scenarios, handicap each one, and either support or destroy the emerging bull case. 
  • Said another way, is the new CEO a change agent that will find another 5 million customers and get KSS to comp for 2 years – or even 1 year – or is this the head fake a la 2015. 
  • While I have a strong analytical bias short side here – like simply click the short button and see where it is at year end - - I am completely open to turning around with a healthy piece of humble pie if the research call tells me to. Call details…

Call Details
Time: Monday February 12th at 10AM EST.
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Confirmation Number: 13675903
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