Why Kohl's (KSS) stock jumped 33% today?

Highlights

Kohl's has received a takeover offer from at least two suitors recently.

Sycamore Partners has offered US$65 per share for Kohl’s purchase.

Kohl's board of directors is currently evaluating the proposals.

Shares of Kohl's Corporation (NYSE: KSS) jumped over 33% on Monday morning after the company revealed receiving takeover offers from at least two companies recently.

Private equity firm Sycamore Partners has offered US$9 billion or US$65 per share, with a premium of 39% from its last closing price for acquiring the department-store chain operator.

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Two days ago, investment firm Starboard Value-backed Acacia Research also had offered US$64 per share for Kohl’s acquisition.

Acacia and Starboard are likely to partner with Oak Street Real Estate Capital to sell off Kohl's real estate to raise money, sources said. But Kohl’s had opposed such a deal in the past.

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Kohl's Corporation (KSS): Stock performance, financials

The Kohl's (KSS) stock traded at US$62.49 at 9:42 am ET on January 24, up 33.41% from its previous close. The stock fell 7.8% over the past 30 days. Kohl's has a market cap of US$8.69 billion, with a P/E ratio of 9.73, and a forward one-year P/E ratio of 6.43. Its EPS is US$6.42.

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The stock saw the highest price of US$64.80 and the lowest price of US$42.68 in the last 52 weeks. Its trading volume on January 21 was 6,266,962.

Its net sales surged 15.6% YoY to US$4.60 billion in Q3, FY21. Its net income came in at US$243 million or US$1.65 per diluted share, against a loss of US$12 million, or US$0.08 per diluted share in the comparable quarter of the previous year.

For fiscal 2021, the company expects its adjusted earnings per share to be between US$7.10 and US$7.30, up from its previous forecast of US$5.80 and US$6.10 per share.

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Bottomline

Kohl’s has confirmed that it received offers for acquiring its business. Its board is currently reviewing the proposals and will decide what "it believes is in the best interest" of the firm and shareholders.

Rupam Roy

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Rupam Roy - Analyst
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Sanjeeb Baruah - Financial Journalist
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