https://kohls.gcs-web.com/static-files/69bb5ef4-94be-4108-9565-ea19aa1e76d8
Low valuation due to retail doom. Company is still making money and forecast EPS is $4.5 for 2019.
Debt is not excessive with interest coverage of ~4x based o operating profit and 6x on op cash.
Debt is eventually spaced out with next debt maturity of 530MM in 2023, 650MM in 2025 and the next big one is 427MM at 2045. In between is small amount maturity which can be handled by its cash holdings. total long term debt is 1.8B vs cash of 0.5B and equity of 5.3B. 9M operating cash flow is already 1B indicating its strong cash generation ability. Company is also actively paying down debt and engaging in the digital transformation which will pay fruits in future. The revenue drop is stablised but profit is lowered due to these investment.
Current valuation is not compelling and is a good entry point. Property and fix assets is 7B indicating a good source for unlocking value should management decide to sell off their assets.
Dividend payout is ~60% on net profit with yield of ~5% which is attractive.
No comments:
Post a Comment