Finc Mgmt - Part 3 - reserve for Scofied

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Intro

STEPS:
1) enter financial data on the Financial Statements Sheet,
2) examine the Ratio Analysis and Cash Flow Analysis,
3) enter forecasts on the Forecasting Assumptions Sheet to create future Financial Statement predictions,
4) enter cost of capital assumptions on the Valuation Parameters Sheet to determine the company's value,
5) evaluate the details of the resulting valuation for either the Residual Income of Discounted Cash Flow models.
Other Useful Links: Where to buy the latest 'Equity Valuation and Analysis' textbook
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© 2012, Russell Lundholm and Richard Sloan.
version 4.00
Russell Lundholm
Richard Sloan

Financial Statements

Financial Statements ($000s) Data can be entered manually in financial statements or as a block cut-and-paste from the Case Data Sheet to the Raw Data Input section below.
Jump to Raw Data Input
Company Name and Ticker KOHL'S KSS Link to Form 10-Ks
Common Shares Outstanding 7,154 (in 000s at most recent fiscal year end)
Estimated Price/Share=$83,726.48
Actual Actual Actual Actual Actual Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
Fiscal Year End (YYYY-MM-DD) 2007/12/31 2008/12/31 2009/12/31 2010/12/31 2011/12/31 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
Income Statement
Sales (Net) 18,800,000 19,280,000 19,030,000 19,020,000 19,200,000 19,417,549 19,673,813 19,970,190 20,308,315 20,690,078 21,117,646 21,593,474 22,120,337 22,701,353 23,340,012 24,040,212 24,761,418
Cost of Goods Sold 1,240,000 13,120,000 12,980,000 12,980,000 13,200,000 13,349,565 13,525,747 13,729,506 13,961,966 14,224,429 14,518,381 14,845,513 15,207,732 15,607,180 16,046,258 16,527,646 17,023,475
Gross Profit 20,040,000 32,400,000 32,010,000 32,000,000 32,400,000 32,767,113 33,199,560 33,699,696 34,270,281 34,914,507 35,636,027 36,438,987 37,328,069 38,308,533 39,386,270 40,567,858 41,784,894
R&D Expense 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
SG&A Expense 4,240,000 4,270,000 4,310,000 4,350,000 4,450,000 4,500,421 4,559,816 4,628,508 4,706,875 4,795,357 4,894,454 5,004,737 5,126,849 5,261,512 5,409,534 5,571,820 5,738,975
EBITDA 24,280,000 36,670,000 36,320,000 36,350,000 36,850,000 37,267,535 37,759,376 38,328,203 38,977,156 39,709,864 40,530,481 41,443,725 42,454,918 43,570,045 44,795,804 46,139,678 47,523,868
Depreciation & Amortization 778,000 833,000 889,000 886,000 934,000 927,571 938,952 952,226 967,466 984,758 1,004,197 1,025,896 1,049,980 1,076,591 1,105,887 1,138,046 1,172,187
EBIT 25,058,000 37,503,000 37,209,000 37,236,000 37,784,000 38,195,106 38,698,328 39,280,430 39,944,622 40,694,622 41,534,679 42,469,621 43,504,899 44,646,636 45,901,691 47,277,723 48,696,055
Net Interest Expense 303,000 329,000 338,000 345,000 332,000 332,012 336,085 340,837 346,292 352,481 359,439 367,206 375,826 385,351 395,837 407,348 419,569
Non-Operating Income (Loss) 1,860,000 1,560,000 140,000 1,350,000 1,060,000 1,072,010 1,086,158 1,102,521 1,121,188 1,142,265 1,165,870 1,192,140 1,221,227 1,253,304 1,288,563 1,327,220 1,367,037
EBT 27,221,000 39,392,000 37,687,000 38,931,000 39,176,000 39,599,128 40,120,572 40,723,787 41,412,102 42,189,367 43,059,988 44,028,967 45,101,952 46,285,291 47,586,091 49,012,292 50,482,660
Income Taxes 692,000 575,000 515,000 482,000 384,000 388,147 393,259 399,171 405,918 413,537 422,071 431,568 442,086 453,685 466,435 480,415 494,827
Other Income (Loss) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Net Income Before Ext. Items 27,913,000 39,967,000 38,202,000 39,413,000 39,560,000 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
Ext. Items & Disc. Ops. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Minority Interest in Earnings 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Preferred Dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Net Income (available to common) 27,913,000 39,967,000 38,202,000 39,413,000 39,560,000 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
Balance Sheet
Operating Cash and Market. Sec. 1,210,000 537,000 971,000 1,410,000 707,000 715,011 724,447 735,361 747,811 761,869 777,613 795,135 814,535 835,930 859,447 885,231 911,788
Receivables 0 0 0 25,000 26,000 26,295 26,642 27,043 27,501 28,018 28,597 29,241 29,955 30,741 31,606 32,554 33,531
Inventories 320,000 3,750,000 3,870,000 3,810,000 4,040,000 4,085,776 4,139,698 4,202,061 4,273,208 4,353,537 4,443,505 4,543,627 4,654,488 4,776,743 4,911,127 5,058,461 5,210,215
Other Current Assets 371,000 434,000 447,000 452,000 305,000 308,456 312,527 317,235 322,606 328,671 335,463 343,021 351,391 360,620 370,766 381,889 393,345
Total Current Assets 1,901,000 4,721,000 5,288,000 5,697,000 5,078,000 5,135,537 5,203,314 5,281,699 5,371,126 5,472,095 5,585,177 5,711,024 5,850,368 6,004,035 6,172,947 6,358,135 6,548,879
PP&E (Net) 8,910,000 8,870,000 8,750,000 8,520,000 8,310,000 8,404,158 8,515,072 8,643,348 8,789,692 8,954,925 9,139,981 9,345,925 9,573,959 9,825,429 10,101,849 10,404,904 10,717,051
Investments 153,000 53,000 64,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Intangibles 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Other Assets 261,000 261,000 277,000 218,000 222,000 224,515 227,478 230,905 234,815 239,229 244,173 249,675 255,766 262,484 269,869 277,965 286,304
Total Assets 11,225,000 13,905,000 14,379,000 14,435,000 13,610,000 13,764,210 13,945,865 14,155,952 14,395,633 14,666,248 14,969,331 15,306,624 15,680,093 16,091,949 16,544,665 17,041,004 17,552,235
Current Debt 94,000 105,000 139,000 110,000 127,000 128,439 130,134 132,094 134,331 136,856 139,684 142,832 146,317 150,160 154,384 159,016 163,786
Accounts Payable 1,230,000 1,310,000 1,370,000 1,510,000 1,250,000 1,264,163 1,280,847 1,300,143 1,322,156 1,347,010 1,374,847 1,405,825 1,440,126 1,477,953 1,519,532 1,565,118 1,612,072
Income Taxes Payable 133,000 290,000 94,000 78,000 130,000 131,473 133,208 135,215 137,504 140,089 142,984 146,206 149,773 153,707 158,031 162,772 167,655
Other Current Liabilities 1,130,000 833,000 1,140,000 11,600,000 1,210,000 1,223,710 1,239,860 1,258,538 1,279,847 1,303,906 1,330,852 1,360,839 1,394,042 1,430,658 1,470,907 1,515,034 1,560,485
Total Current Liabilities 2,587,000 2,538,000 2,743,000 13,298,000 2,717,000 2,747,785 2,784,050 2,825,990 2,873,838 2,927,862 2,988,367 3,055,701 3,130,258 3,212,478 3,302,855 3,401,940 3,503,999
Long-Term Debt 4,150,000 4,450,000 4,720,000 4,650,000 4,580,000 4,631,894 4,693,024 4,763,722 4,844,379 4,935,446 5,037,438 5,150,943 5,276,622 5,415,219 5,567,565 5,734,592 5,906,630
Other Liabilities 460,000 512,000 560,000 562,000 563,000 569,379 576,894 585,584 595,499 606,693 619,231 633,184 648,633 665,670 684,397 704,929 726,077
Deferred Taxes 386,000 362,000 382,000 368,000 257,000 259,912 263,342 267,309 271,835 276,945 282,668 289,038 296,090 303,867 312,416 321,788 331,442
Total Liabilities 7,583,000 7,862,000 8,405,000 18,878,000 8,117,000 8,208,971 8,317,310 8,442,606 8,585,552 8,746,946 8,927,705 9,128,866 9,351,603 9,597,233 9,867,233 10,163,250 10,468,148
Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Paid in Common Capital (Net) 6,510,000 6,050,000 5,980,000 59,900,000 5,490,000 (46,762,036) (87,202,551) (128,240,718) (169,962,003) (212,455,687) (255,815,420) (300,139,824) (345,533,129) (392,105,880) (439,975,690) (489,268,073) (540,039,228)
Retained Earnings 10,200,000 10,880,000 11,460,000 12,010,000 12,330,000 52,317,276 92,831,106 133,954,065 175,772,085 218,374,989 261,857,047 306,317,582 351,861,620 398,600,595 446,653,122 496,145,828 547,123,315
Total Common Equity 16,710,000 16,930,000 17,440,000 71,910,000 17,820,000 5,555,239 5,628,555 5,713,347 5,810,082 5,919,302 6,041,626 6,177,758 6,328,490 6,494,715 6,677,431 6,877,754 7,084,087
Total Liabilities and Equity 24,293,000 24,792,000 25,845,000 90,788,000 25,937,000 13,764,210 13,945,865 14,155,952 14,395,633 14,666,248 14,969,331 15,306,624 15,680,093 16,091,949 16,544,665 17,041,004 17,552,235
Error! A =L+E?
Statement of Retained Earnings
Beg. Retained Earnings 10,200,000 10,880,000 11,460,000 12,010,000 12,330,000 52,317,276 92,831,106 133,954,065 175,772,085 218,374,989 261,857,047 306,317,582 351,861,620 398,600,595 446,653,122 496,145,828
+Net Income 39,967,000 38,202,000 39,413,000 39,560,000 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
-Common Dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=End. Retained Earnings 10,880,000 11,460,000 12,010,000 12,330,000 52,317,276 92,831,106 133,954,065 175,772,085 218,374,989 261,857,047 306,317,582 351,861,620 398,600,595 446,653,122 496,145,828 547,123,315
Values for Dupont Analysis and Valuation
Net Operating Income 27,602,297 39,633,198 37,859,381 39,063,729 39,224,746 39,652,010 40,174,451 40,778,781 41,468,334 42,246,968 43,119,096 44,089,730 45,164,528 46,349,847 47,652,809 49,081,365 50,553,806
Net Financial Expense 310,703 333,802 342,619 349,271 335,254 335,266 339,380 344,177 349,686 355,936 362,962 370,805 379,510 389,129 399,717 411,341 423,681
Net Income 27,913,000 39,967,000 38,202,000 39,413,000 39,560,000 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
Effective Tax Rate (0.0254) (0.0146) (0.0137) (0.0124) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098) (0.0098)
Net Operating Assets 20,954,000 21,485,000 22,299,000 76,670,000 22,527,000 10,315,573 10,451,713 10,609,164 10,788,792 10,991,604 11,218,749 11,471,533 11,751,429 12,060,094 12,399,381 12,771,363 13,154,504
Net Financial Obligations 4,244,000 4,555,000 4,859,000 4,760,000 4,707,000 4,760,333 4,823,158 4,895,817 4,978,710 5,072,302 5,177,123 5,293,775 5,422,939 5,565,379 5,721,950 5,893,608 6,070,416
Total Common Equity 16,710,000 16,930,000 17,440,000 71,910,000 17,820,000 5,555,239 5,628,555 5,713,347 5,810,082 5,919,302 6,041,626 6,177,758 6,328,490 6,494,715 6,677,431 6,877,754 7,084,087
Raw Data Inputs cut-and-paste raw data block from DataMaker file here
Company Name and Ticker KOHL'S KSS A Windows vs Macintosh issue can cause the fiscal year end dates to be off by roughly 4 years. If this occurs, select and copy the 1462 cell below, select the cells with the dates, choose Paste Special Values and select Subtract or Add.
Common Shares Outstanding 7,154
Fiscal Year End (YYYY-MM-DD) 2007/12/31 2008/12/31 2009/12/31 2010/12/31 2011/12/31
Sales (Net) 18,800,000 19280000 19030000 19020000 19200000
Cost of Goods Sold 1240000 13120000 12980000 12980000 13200000
R&D Expense 0 0 0 0 0
SG&A Expense 4240000 4270000 4310000 4350000 4450000
Depreciation & Amortization 778000 833000 889000 886000 934000
Interest Expense 303000 329000 338000 345000 332000
Non-Operating Income (Loss) 1860000 1560000 140000 1350000 1060000
Income Taxes 692000 575000 515000 482000 384000
Minority Interest in Earnings 0 0 0 0 0
Other Income (Loss) 0 0 0 0 0
Ext. Items & Disc. Ops. 0 0 0 0 0
Preferred Dividends 0 0 0 0 0
Operating Cash and Market. Sec. 1210000 537000 971000 1410000 707000
Receivables 0 0 0 25,000 26,000
Inventories 320000 3750000 3870000 3810000 4040000
Other Current Assets 371000 434000 447000 452000 305000
PP&E (Net) 8910000 8870000 8750000 8520000 8310000
Investments 153000 53000 64000 0 0
Intangibles 0 0 0 0 0
Other Assets 261000 261000 277000 218000 222000
Current Debt 94000 105000 139000 110000 127000
Accounts Payable 1230000 1310000 1370000 1510000 1250000
Income Taxes Payable 133000 290000 94000 78000 130000
Other Current Liabilities 1130000 833000 1140000 11600000 1210000
Long-Term Debt 4150000 4450000 4720000 4650000 4580000
Other Liabilities 460000 512000 560000 562000 563000
Deferred Taxes 386000 362000 382000 368000 257000
Minority Interest 0 0 0 0 0
Preferred Stock 0 0 0 0 0
Paid in Common Capital (Net) 6510000 6050000 5980000 59900000 5490000
Retained Earnings 10200000 10880000 11460000 12010000 12330000
Common Dividends 0 0 0 0 0

Ratio Analysis

Ratio Analysis
Company Name KOHL'S
Actual Actual Actual Actual Actual Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
Fiscal Year End Date 2007/12/31 2008/12/31 2009/12/31 2010/12/31 2011/12/31 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
Annual Growth Rates
Sales 2.6% -1.3% -0.1% 0.9% 1.1% 1.3% 1.5% 1.7% 1.9% 2.1% 2.3% 2.4% 2.6% 2.8% 3.0% 3.0%
Assets 23.9% 3.4% 0.4% -5.7% 1.1% 1.3% 1.5% 1.7% 1.9% 2.1% 2.3% 2.4% 2.6% 2.8% 3.0% 3.0%
Common Equity 1.3% 3.0% 312.3% -75.2% -68.8% 1.3% 1.5% 1.7% 1.9% 2.1% 2.3% 2.4% 2.6% 2.8% 3.0% 3.0%
Earnings 43.2% -4.4% 3.2% 0.4% 1.1% 1.3% 1.5% 1.7% 1.9% 2.1% 2.3% 2.4% 2.6% 2.8% 3.0% 3.0%
Free Cash Flow to Investors 0.0% 449962.2% -192.4% 0.0% 1.3% 1.5% 1.6% 1.8% 2.0% 2.2% 2.4% 2.6% 2.8% 3.0% 3.0%
Sustainable Growth Rate 222.3% 88.2% 88.2% 342.1% 724.5% 725.2% 725.8% 726.4% 727.1% 727.7% 728.3% 729.0% 729.6% 730.2% 730.2%
Profitability
Return on Equity 2.376 2.223 0.882 0.882 3.421 7.245 7.252 7.258 7.264 7.271 7.277 7.283 7.290 7.296 7.302 7.302
Return on Equity (b4 non-recurring) 2.282 2.215 0.852 0.858 3.329 7.049 7.055 7.061 7.068 7.074 7.080 7.086 7.092 7.099 7.105 7.105
Return on Net Operating Assets 1.868 1.729 0.789 0.791 2.415 3.869 3.872 3.876 3.879 3.883 3.886 3.890 3.893 3.896 3.900 3.900
Basic Dupont Model
Net Profit Margin 1.485 2.073 2.007 2.072 2.060 2.059 2.059 2.059 2.059 2.059 2.059 2.059 2.059 2.059 2.059 2.059 2.059
x Total Asset Turnover 1.534 1.346 1.320 1.369 1.419 1.420 1.421 1.423 1.424 1.425 1.426 1.428 1.429 1.430 1.432 1.432
x Total Leverage 1.459 1.473 1.305 1.301 1.698 2.478 2.478 2.478 2.478 2.478 2.478 2.478 2.478 2.478 2.478 2.478
= Return on Equity 4.641 3.980 3.571 3.670 4.962 7.245 7.252 7.258 7.264 7.271 7.277 7.283 7.290 7.296 7.302 7.302
Advanced Dupont Model
Net Operating Margin 1.468 2.056 1.989 2.054 2.043 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042
x Net Operating Asset Turnover 0.909 0.869 0.384 0.387 1.182 1.895 1.896 1.898 1.900 1.902 1.903 1.905 1.907 1.908 1.910 1.910
= Return on Net Operating Assets 1.868 1.729 0.789 0.791 2.415 3.869 3.872 3.876 3.879 3.883 3.886 3.890 3.893 3.896 3.900 3.900
Net Borrowing Cost (NBC) (0.076) (0.073) (0.073) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071) (0.071)
Spread (RNOA - NBC) 1.944 1.802 0.862 0.862 2.485 3.940 3.943 3.947 3.950 3.954 3.957 3.960 3.964 3.967 3.971 3.971
Financial Leverage (LEV) 0.262 0.274 0.108 0.106 0.405 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857
ROE = RNOA + LEV*Spread 2.376 2.223 0.882 0.882 3.421 7.245 7.252 7.258 7.264 7.271 7.277 7.283 7.290 7.296 7.302 7.302
Margin Analysis
Gross Margin 1.066 1.680 1.682 1.682 1.688 1.688 1.688 1.688 1.688 1.688 1.688 1.688 1.688 1.688 1.688 1.688 1.688
EBITDA Margin 1.291 1.902 1.909 1.911 1.919 1.919 1.919 1.919 1.919 1.919 1.919 1.919 1.919 1.919 1.919 1.919 1.919
EBIT Margin 1.333 1.945 1.955 1.958 1.968 1.967 1.967 1.967 1.967 1.967 1.967 1.967 1.967 1.967 1.967 1.967 1.967
Net Operating Margin (b4 non-rec.) 1.367 1.974 1.982 1.982 1.987 1.986 1.986 1.986 1.986 1.986 1.986 1.986 1.986 1.986 1.986 1.986 1.986
Net Operating Margin 1.468 2.056 1.989 2.054 2.043 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042 2.042
Turnover Analysis
Net Operating Asset Turnover 0.909 0.869 0.384 0.387 1.182 1.895 1.896 1.898 1.900 1.902 1.903 1.905 1.907 1.908 1.910 1.910
Net Working Capital Turnover 22.736 7.655 (7.913) (7.675) 7.761 7.768 7.775 7.782 7.789 7.796 7.803 7.810 7.817 7.824 7.831 7.831
Avge Days to Collect Receivables 0.000 0.000 0.240 0.485 0.492 0.491 0.491 0.490 0.490 0.489 0.489 0.488 0.488 0.488 0.487 0.487
Avge Inventory Holding Period (56.614) (107.138) (107.982) (108.532) (111.086) (110.985) (110.883) (110.782) (110.681) (110.581) (110.481) (110.382) (110.283) (110.184) (110.085) (110.085)
Avge Days to Pay Payables (47.838) (38.033) (40.307) (38.836) (34.489) (34.477) (34.464) (34.452) (34.440) (34.428) (34.416) (34.404) (34.391) (34.379) (34.367) (34.367)
PP&E Turnover 2.169 2.160 2.203 2.282 2.323 2.326 2.328 2.330 2.332 2.334 2.336 2.338 2.340 2.343 2.345 2.345
Analysis of Leverage
- Long-Term Capital Structure
Debt to Equity Ratio 0.254 0.269 0.279 0.066 0.264 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857
FFO to Total Debt 8.901 7.942 8.008 8.137 8.253 8.261 8.269 8.277 8.285 8.292 8.300 8.308 8.316 8.323 8.331 8.331
CFO to Total Debt 8.094 7.950 10.215 5.880 8.249 8.256 8.263 8.270 8.278 8.285 8.292 8.299 8.306 8.313 8.320 8.320
Analysis of Leverage
- Short-Term Liquidity
Current Ratio 0.735 1.860 1.928 0.428 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869
Quick Ratio 0.468 0.212 0.354 0.108 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270
EBIT Interest Coverage (82.700) (113.991) (110.086) (107.930) (113.807) (115.041) (115.144) (115.247) (115.350) (115.452) (115.554) (115.656) (115.758) (115.860) (115.961) (116.062) (116.062)
EBITDA Interest Coverage (80.132) (111.459) (107.456) (105.362) (110.994) (112.248) (112.351) (112.453) (112.556) (112.658) (112.760) (112.862) (112.964) (113.066) (113.167) (113.268) (113.268)
Fiscal Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Cash Flow Analysis

Cash Flow Analysis ($000)
Company Name KOHL'S
Actual Actual Actual Actual Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
Fiscal Year End Date 2008/12/31 2009/12/31 2010/12/31 2011/12/31 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
Pro Forma Statement of Cash Flows
Operating:
Net Income 39,967,000 38,202,000 39,413,000 39,560,000 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
+Depreciation & Amortization (833,000) (889,000) (886,000) (934,000) (927,571) (938,952) (952,226) (967,466) (984,758) (1,004,197) (1,025,896) (1,049,980) (1,076,591) (1,105,887) (1,138,046) (1,172,187)
+Increase in Deferred Taxes (24,000) 20,000 (14,000) (111,000) 2,912 3,430 3,967 4,526 5,110 5,723 6,369 7,052 7,777 8,549 9,372 9,654
+Increase in Other Liabilities 52,000 48,000 2,000 1,000 6,379 7,514 8,691 9,915 11,194 12,538 13,953 15,449 17,037 18,727 20,532 21,148
+Minority Interest in Earnings 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+Preferred Dividends 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
=Funds From Operations 39,162,000 37,381,000 38,515,000 38,516,000 39,068,995 39,585,823 40,183,390 40,864,995 41,634,451 42,496,121 43,454,960 44,516,559 45,687,199 46,973,915 48,384,565 49,836,102
-Increase in Receivables 0 0 (25,000) (1,000) (295) (347) (401) (458) (517) (579) (644) (713) (787) (865) (948) (977)
-Increase in Inventory (3,430,000) (120,000) 60,000 (230,000) (45,776) (53,922) (62,363) (71,147) (80,329) (89,967) (100,122) (110,861) (122,255) (134,384) (147,334) (151,754)
-Increase in Other Current Assets (63,000) (13,000) (5,000) 147,000 (3,456) (4,071) (4,708) (5,371) (6,064) (6,792) (7,559) (8,369) (9,230) (10,145) (11,123) (11,457)
+Increase in Accounts Payable 80,000 60,000 140,000 (260,000) 14,163 16,684 19,295 22,013 24,854 27,836 30,978 34,301 37,827 41,579 45,586 46,954
+Increase in Taxes Payable 157,000 (196,000) (16,000) 52,000 1,473 1,735 2,007 2,289 2,585 2,895 3,222 3,567 3,934 4,324 4,741 4,883
+Increase in Other Curr. Liabilities (297,000) 307,000 10,460,000 (10,390,000) 13,710 16,150 18,678 21,309 24,059 26,946 29,987 33,203 36,616 40,249 44,127 45,451
=Cash From Operations 35,609,000 37,419,000 49,129,000 27,834,000 39,048,816 39,562,052 40,155,898 40,833,630 41,599,038 42,456,460 43,410,822 44,467,687 45,633,304 46,914,673 48,319,614 49,769,202
Investing:
-Capital Expenditures 873,000 1,009,000 1,116,000 1,144,000 833,413 828,037 823,951 821,122 819,526 819,141 819,952 821,947 825,120 829,468 834,990 860,040
-Increase in Investments 100,000 (11,000) 64,000 0 0 0 0 0 0 0 0 0 0 0 0 0
-Purchases of Intangibles 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Increase in Other Assets 0 (16,000) 59,000 (4,000) (2,515) (2,963) (3,427) (3,910) (4,414) (4,944) (5,502) (6,092) (6,718) (7,384) (8,096) (8,339)
=Cash From Investing 973,000 982,000 1,239,000 1,140,000 830,898 825,074 820,524 817,212 815,111 814,197 814,450 815,856 818,402 822,083 826,894 851,701
Financing:
+Increase in Debt 311,000 304,000 (99,000) (53,000) 53,333 62,825 72,659 82,893 93,592 104,821 116,652 129,164 142,440 156,571 171,658 176,808
-Dividends Paid to Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Dividends Paid on Preferred 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+Increase in Pref. Stock 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Dividends Paid on Common 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+/-Net Issuance of Common Stock (460,000) (70,000) 53,920,000 (54,410,000) (52,252,036) (40,440,515) (41,038,167) (41,721,285) (42,493,684) (43,359,734) (44,324,404) (45,393,306) (46,572,751) (47,869,810) (49,292,383) (50,771,155)
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=Cash From Financing (39,436,000) (37,388,000) 14,958,000 (93,703,000) (52,198,703) (40,377,690) (40,965,508) (41,638,392) (42,400,092) (43,254,913) (44,207,751) (45,264,142) (46,430,311) (47,713,239) (49,120,725) (50,594,346)
Net Change in Cash (2,854,000) 1,013,000 65,326,000 (64,729,000) (12,318,989) 9,436 10,913 12,451 14,058 15,744 17,521 19,401 21,395 23,517 25,783 26,557
+ Beginning Cash Balance 1,210,000 537,000 971,000 1,410,000 707,000 715,011 724,447 735,361 747,811 761,869 777,613 795,135 814,535 835,930 859,447 885,231
= Ending Cash Balance (1,644,000) 1,550,000 66,297,000 (63,319,000) (11,611,989) 724,447 735,361 747,811 761,869 777,613 795,135 814,535 835,930 859,447 885,231 911,788
Free Cash Flow to Common Equity
Net Income 39,967,000 38,202,000 39,413,000 39,560,000 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
- Increase in Common Equity (220,000) (510,000) (54,470,000) 54,090,000 12,264,761 (73,316) (84,792) (96,735) (109,220) (122,324) (136,132) (150,732) (166,225) (182,716) (200,323) (206,333)
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=Free Cash Flow to Common Equity 460,000 70,000 (53,920,000) 54,410,000 52,252,036 40,440,515 41,038,167 41,721,285 42,493,684 43,359,734 44,324,404 45,393,306 46,572,751 47,869,810 49,292,383 50,771,155
Computation based on SCF:
+Cash From Operations 35,609,000 37,419,000 49,129,000 27,834,000 39,048,816 39,562,052 40,155,898 40,833,630 41,599,038 42,456,460 43,410,822 44,467,687 45,633,304 46,914,673 48,319,614 49,769,202
-Increase in Cash 2,854,000 (1,013,000) (65,326,000) 64,729,000 12,318,989 (9,436) (10,913) (12,451) (14,058) (15,744) (17,521) (19,401) (21,395) (23,517) (25,783) (26,557)
+Cash From Investing 973,000 982,000 1,239,000 1,140,000 830,898 825,074 820,524 817,212 815,111 814,197 814,450 815,856 818,402 822,083 826,894 851,701
+Increase in Debt 311,000 304,000 (99,000) (53,000) 53,333 62,825 72,659 82,893 93,592 104,821 116,652 129,164 142,440 156,571 171,658 176,808
-Dividends Paid to Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Dividends Paid on Preferred 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+Increase in Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=Free Cash Flow to Common Equity 460,000 70,000 (53,920,000) 54,410,000 52,252,036 40,440,515 41,038,167 41,721,285 42,493,684 43,359,734 44,324,404 45,393,306 46,572,751 47,869,810 49,292,383 50,771,155
Financing Flows:
+Dividends Paid 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Net Issuance of Common Stock 460,000 70,000 (53,920,000) 54,410,000 52,252,036 40,440,515 41,038,167 41,721,285 42,493,684 43,359,734 44,324,404 45,393,306 46,572,751 47,869,810 49,292,383 50,771,155
= Free Cash Flow to Common Equity 460,000 70,000 (53,920,000) 54,410,000 52,252,036 40,440,515 41,038,167 41,721,285 42,493,684 43,359,734 44,324,404 45,393,306 46,572,751 47,869,810 49,292,383 50,771,155
Free Cash Flow to all Investors
Net Operating Income 39,633,198 37,859,381 39,063,729 39,224,746 39,652,010 40,174,451 40,778,781 41,468,334 42,246,968 43,119,096 44,089,730 45,164,528 46,349,847 47,652,809 49,081,365 50,553,806
- Increase in Net Operating Assets (531,000) (814,000) (54,371,000) 54,143,000 12,211,427 (136,141) (157,450) (179,629) (202,812) (227,145) (252,784) (279,896) (308,665) (339,287) (371,981) (383,141)
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=Free Cash Flow to Investors (184,802) (576,619) (54,170,271) 54,127,746 51,863,437 40,038,310 40,621,331 41,288,706 42,044,156 42,891,951 43,836,946 44,884,631 46,041,183 47,313,521 48,709,384 50,170,665
Computation based on SCF:
Cash From Operations 35,609,000 37,419,000 49,129,000 27,834,000 39,048,816 39,562,052 40,155,898 40,833,630 41,599,038 42,456,460 43,410,822 44,467,687 45,633,304 46,914,673 48,319,614 49,769,202
-Increase in Operating Cash 673,000 (434,000) (439,000) 703,000 (8,011) (9,436) (10,913) (12,451) (14,058) (15,744) (17,521) (19,401) (21,395) (23,517) (25,783) (26,557)
+Cash from Investing 973,000 982,000 1,239,000 1,140,000 830,898 825,074 820,524 817,212 815,111 814,197 814,450 815,856 818,402 822,083 826,894 851,701
+Interest Expense (329,000) (338,000) (345,000) (332,000) (332,012) (336,085) (340,837) (346,292) (352,481) (359,439) (367,206) (375,826) (385,351) (395,837) (407,348) (419,569)
-Tax Shield on Interest (4,802) (4,619) (4,271) (3,254) (3,254) (3,294) (3,341) (3,394) (3,455) (3,523) (3,599) (3,684) (3,777) (3,880) (3,993) (4,113)
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=Free Cash Flow to Investors (2,365,802) 2,381 10,716,729 (9,898,254) 39,536,437 40,038,310 40,621,331 41,288,706 42,044,156 42,891,951 43,836,946 44,884,631 46,041,183 47,313,521 48,709,384 50,170,665
Financing Flows:
+Dividends on Common Stock 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+Interest Expense (329,000) (338,000) (345,000) (332,000) (332,012) (336,085) (340,837) (346,292) (352,481) (359,439) (367,206) (375,826) (385,351) (395,837) (407,348) (419,569)
-Tax Shield on Interest (4,802) (4,619) (4,271) (3,254) (3,254) (3,294) (3,341) (3,394) (3,455) (3,523) (3,599) (3,684) (3,777) (3,880) (3,993) (4,113)
+Dividends on Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+Dividends Paid to Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Net Issuance of Common Stock 460,000 70,000 (53,920,000) 54,410,000 52,252,036 40,440,515 41,038,167 41,721,285 42,493,684 43,359,734 44,324,404 45,393,306 46,572,751 47,869,810 49,292,383 50,771,155
-Net Issuance of Debt (311,000) (304,000) 99,000 53,000 (53,333) (62,825) (72,659) (82,893) (93,592) (104,821) (116,652) (129,164) (142,440) (156,571) (171,658) (176,808)
-Net Issuance of Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
=Free Cash Flow to Investors (184,802) (576,619) (54,170,271) 54,127,746 51,863,437 40,038,310 40,621,331 41,288,706 42,044,156 42,891,951 43,836,946 44,884,631 46,041,183 47,313,521 48,709,384 50,170,665
Traditional Computation of FCF:
EBIT 37,503,000 37,209,000 37,236,000 37,784,000 38,195,106 38,698,328 39,280,430 39,944,622 40,694,622 41,534,679 42,469,621 43,504,899 44,646,636 45,901,691 47,277,723 48,696,055
-Taxes on EBIT 570,198 510,381 477,729 380,746 384,893 389,964 395,830 402,524 410,082 418,547 427,969 438,402 449,908 462,555 476,422 490,714
+Increase in Deferred Taxes (24,000) 20,000 (14,000) (111,000) 2,912 3,430 3,967 4,526 5,110 5,723 6,369 7,052 7,777 8,549 9,372 9,654
= NOPLAT 38,049,198 37,739,381 37,699,729 38,053,746 38,582,911 39,091,723 39,680,227 40,351,672 41,109,813 41,958,949 42,903,959 43,950,353 45,104,320 46,372,794 47,763,518 49,196,423
+Depreciation & Amortization (833,000) (889,000) (886,000) (934,000) (927,571) (938,952) (952,226) (967,466) (984,758) (1,004,197) (1,025,896) (1,049,980) (1,076,591) (1,105,887) (1,138,046) (1,172,187)
+Non-Operating Income (Loss) 1,560,000 140,000 1,350,000 1,060,000 1,072,010 1,086,158 1,102,521 1,121,188 1,142,265 1,165,870 1,192,140 1,221,227 1,253,304 1,288,563 1,327,220 1,367,037
+Other Income (Loss) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
+Ext. Items & Disc. Ops. 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
=Gross Cash Flow 38,776,198 36,990,381 38,163,729 38,179,746 38,727,350 39,238,929 39,830,522 40,505,394 41,267,320 42,120,622 43,070,203 44,121,599 45,281,033 46,555,471 47,952,692 49,391,273
-Increase in Working Capital (2,880,000) (396,000) 10,175,000 (9,979,000) (28,191) (33,208) (38,405) (43,815) (49,470) (55,406) (61,659) (68,273) (75,290) (82,760) (90,734) (93,456)
-Capital Expenditures 873,000 1,009,000 1,116,000 1,144,000 833,413 828,037 823,951 821,122 819,526 819,141 819,952 821,947 825,120 829,468 834,990 860,040
-Increase in Investments 100,000 (11,000) 64,000 0 0 0 0 0 0 0 0 0 0 0 0 0
-Purchases of Intangibles 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
-Increase in Other Assets 0 (16,000) 59,000 (4,000) (2,515) (2,963) (3,427) (3,910) (4,414) (4,944) (5,502) (6,092) (6,718) (7,384) (8,096) (8,339)
+Increase in Other Liabilities 52,000 48,000 2,000 1,000 6,379 7,514 8,691 9,915 11,194 12,538 13,953 15,449 17,037 18,727 20,532 21,148
+/-Clean Surplus Plug (Ignore) (39,287,000) (37,622,000) (38,863,000) (39,240,000) 0 0 0 0 0 0 0 0 0 0 0 0
=Free Cash Flow to Investors (2,365,802) 2,381 10,716,729 (9,898,254) 39,536,437 40,038,310 40,621,331 41,288,706 42,044,156 42,891,951 43,836,946 44,884,631 46,041,183 47,313,521 48,709,384 50,170,665
Analysis of Earnings Quality
(Red Shading = Quality Flag)
Current Op. Accruals/NOA 0.180 (0.002) (0.498) 0.142 0.001 0.002 0.003 0.003 0.004 0.004 0.004 0.005 0.005 0.005 0.006 0.006
+ Non-Current Op. Accruals/NOA (0.009) (0.008) (0.016) (0.001) 0.004 0.011 0.012 0.014 0.015 0.017 0.018 0.020 0.021 0.023 0.024 0.024
= Operating Accruals/NOA 0.061 0.018 2.529 (0.710) (0.560) 0.013 0.015 0.017 0.019 0.021 0.023 0.024 0.026 0.028 0.030 0.030
Sales Growth 0.026 (0.013) (0.001) 0.009 0.011 0.013 0.015 0.017 0.019 0.021 0.023 0.024 0.026 0.028 0.030 0.030
- NOA Turnover Growth 0.035 0.032 2.531 (0.713) (0.565) 0.000 0.000 0.000 0.000 0.000 0.000 (0.000) 0.000 0.000 (0.000) (0.000)
- Interaction 0.001 (0.000) (0.001) (0.007) (0.006) 0.000 0.000 0.000 0.000 0.000 0.000 (0.000) 0.000 0.000 (0.000) (0.000)
= Operating Accruals/NOA 0.061 0.018 2.529 (0.710) (0.560) 0.013 0.015 0.017 0.019 0.021 0.023 0.024 0.026 0.028 0.030 0.030
Fiscal Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Credit Analysis

Credit Analysis
Company Name KOHL'S
Actual Actual Actual Actual Actual Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
Fiscal Year End Date 2007/12/31 2008/12/31 2009/12/31 2010/12/31 2011/12/31 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
Analysis of Leverage
- Long-Term Capital Structure
Debt to Equity Ratio 0.254 0.269 0.279 0.066 0.264 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857 0.857
FFO to Total Debt 8.901 7.942 8.008 8.137 8.253 8.261 8.269 8.277 8.285 8.292 8.300 8.308 8.316 8.323 8.331 8.331
CFO to Total Debt 8.094 7.950 10.215 5.880 8.249 8.256 8.263 8.270 8.278 8.285 8.292 8.299 8.306 8.313 8.320 8.320
Analysis of Leverage
- Short-Term Liquidity
Current Ratio 0.735 1.860 1.928 0.428 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869 1.869
Quick Ratio 0.468 0.212 0.354 0.108 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270
EBIT Interest Coverage (82.700) (113.991) (110.086) (107.930) (113.807) (115.041) (115.144) (115.247) (115.350) (115.452) (115.554) (115.656) (115.758) (115.860) (115.961) (116.062) (116.062)
EBITDA Interest Coverage (80.132) (111.459) (107.456) (105.362) (110.994) (112.248) (112.351) (112.453) (112.556) (112.658) (112.760) (112.862) (112.964) (113.066) (113.167) (113.268) (113.268)
Analysis of Credit Risk
Net Income to Total Assets 2.487 2.874 2.657 2.730 2.907 2.905 2.905 2.905 2.905 2.905 2.905 2.905 2.905 2.904 2.904 2.904 2.904
implied default probability 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0% 2.0%
Total Liabilities to Total Assets 0.676 0.565 0.585 1.308 0.596 0.596 0.596 0.596 0.596 0.596 0.596 0.596 0.596 0.596 0.596 0.596 0.596
implied default probability 5.5% 4.5% 4.5% 10.0% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5%
Quick Ratio 0.468 0.212 0.354 0.108 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270 0.270
implied default probability 6.5% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0% 9.0%
EBIT to Interest Expense (82.70) (113.99) (110.09) (107.93) (113.81) (115.04) (115.14) (115.25) (115.35) (115.45) (115.55) (115.66) (115.76) (115.86) (115.96) (116.06) (116.06)
implied default probability 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5%
Inventory Holding Period -94.19 -104.33 -108.83 -107.14 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71 -111.71
implied default probability 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0%
Annual Sales Growth 0.0% 2.6% -1.3% -0.1% 0.9% 1.1% 1.3% 1.5% 1.7% 1.9% 2.1% 2.3% 2.4% 2.6% 2.8% 3.0% 3.0%
implied default probability 4.2% 3.2% 4.2% 4.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2% 3.2%
Average Implied Default Probability 4.8% 4.9% 5.0% 6.0% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9% 4.9%
Fiscal Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
Lookup Table of default probability decile 1 min decile 2 min decile 3 min decile 4 min decile 5 min decile 6 min decile 7 min decile 8 min decile 9 min decile 10
NI to TA thresholds -0.448 -0.161 -0.049 0.001 0.022 0.038 0.056 0.079 0.118
NI to TA default rates 0.083 0.08 0.072 0.055 0.045 0.030 0.025 0.020 0.020 0.020
TL to TA thresholds 0.175 0.283 0.385 0.476 0.558 0.633 0.709 0.816 1.030
TL to TA default rates 0.02 0.022 0.025 0.030 0.035 0.045 0.055 0.070 0.090 0.100
Quick Ratio thresholds 0.382 0.522 0.809 0.994 1.200 1.470 1.890 2.530 4.550
Quick Ratio default rates 0.09 0.065 0.05 0.042 0.040 0.035 0.025 0.020 0.015 0.010
EBIT to Int thresholds -17.4 -3.6 -0.139 1.25 2.210 3.380 5.210 9.160 23.800
EBIT to Int default rates 0.075 0.09 0.085 0.070 0.050 0.030 0.021 0.018 0.015 0.010
Inv Holding thresholds 0.365 2.56 14.24 31.39 50 70.080 91.980 121.540 174.470
Inv Holding default rates 0.03 0.035 0.039 0.040 0.042 0.045 0.049 0.055 0.060 0.070
Sales Growth thresholds -0.203 -0.063 0.003 0.05 0.098 0.158 0.244 0.398 0.797
Sales Growth default rates 0.069 0.055 0.042 0.032 0.030 0.030 0.032 0.042 0.050 0.065

Forecasting Assumptions

Forecasting Assumptions
Company Name KOHL'S
TERMINAL
Estimated Price/Share=$83,726.48 YEAR
Actual Actual Actual Actual Actual Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
Fiscal Year End Date 2007/12/31 2008/12/31 2009/12/31 2010/12/31 2011/12/31 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
Implied Return on Equity 2.376 2.223 0.882 0.882 3.421 7.245 7.252 7.258 7.264 7.271 7.277 7.283 7.290 7.296 7.302 7.302
Income Statement Assumptions
Sales Growth 2.6% -1.3% -0.1% 0.9% 1.1% 1.3% 1.5% 1.7% 1.9% 2.1% 2.3% 2.4% 2.6% 2.8% 3.0% 3.0%
Cost of Goods Sold/Sales -6.6% -68.0% -68.2% -68.2% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8% -68.8%
R&D/Sales 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
SG&A/Sales -22.6% -22.1% -22.6% -22.9% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2% -23.2%
Dep&Amort/Avge PP&E and Intang. -9.4% -10.1% -10.3% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1% -11.1%
Net Interest Expense/Avge Net Debt -7.5% -7.2% -7.2% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0% -7.0%
Non-Operating Income/Sales 9.9% 8.1% 0.7% 7.1% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5% 5.5%
Effective Tax Rate -2.5% -1.5% -1.4% -1.2% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0% -1.0%
Minority Interest/After Tax Income 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Other Income/Sales 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Ext. Items & Disc. Ops./Sales 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Pref. Dividends/Avge Pref. Stock 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Balance Sheet Assumptions
Working Capital Assumptions
Ending Operating Cash/Sales 6.4% 2.8% 5.1% 7.4% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7% 3.7%
Ending Receivables/Sales 0.0% 0.0% 0.0% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1%
Ending Inventories/COGS -25.8% -28.6% -29.8% -29.4% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6% -30.6%
Ending Other Current Assets/Sales 2.0% 2.3% 2.3% 2.4% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6%
Ending Accounts Payable/COGS -99.2% -10.0% -10.6% -11.6% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5% -9.5%
Ending Taxes Payable/Sales 0.7% 1.5% 0.5% 0.4% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7% 0.7%
Ending Other Current Liabs/Sales 6.0% 4.3% 6.0% 61.0% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3% 6.3%
Other Operating Asset Assumptions
Ending Net PP&E/Sales 47.4% 46.0% 46.0% 44.8% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3% 43.3%
Ending Investments/Sales 0.8% 0.3% 0.3% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Ending Intangibles/Sales 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Ending Other Assets/Sales 1.4% 1.4% 1.5% 1.1% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2% 1.2%
Other Operating Liability Assumptions
Other Liabilities/Sales 2.4% 2.7% 2.9% 3.0% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9% 2.9%
Deferred Taxes/Sales 2.1% 1.9% 2.0% 1.9% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3% 1.3%
Financing Assumptions
Current Debt/Total Assets 0.8% 0.8% 1.0% 0.8% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9% 0.9%
Long-Term Debt/Total Assets 37.0% 32.0% 32.8% 32.2% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7% 33.7%
Minority Interest/Total Assets 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Preferred Stock/Total Assets 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Dividend Payout Ratio 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Valuation Parameters

Valuation Parameters
Estimated Price/Share=$83,726.48
Company Name: KOHL'S
Required Valuation Parameters (to compute value of common equity):
Enter Cost of Equity Capital: 10.00%
Enter Value of Contingent Claims on Common Equity ($000): 0
Enter Date of Valuation: 2012/06/20
Enter Dilution Factor for Splits Occurring Since Latest Fiscal Year End: 1.00
Optional Valuation Parameters (to compute value to all investors):
Enter Cost of Net Debt: 8.00%
Enter Cost of Preferred Stock: 9.00%
Enter Cost of Minority Interest: 10.00%
Adjust the Weighted Average Cost of Capital Input 9.3720% up
such that the two equity values below are approximately equal:
Equity Value computed directly Equity Value computed indirectly approximate weighted average
from flows to equityholders: as the Entity Value less non-equity claims: cost of capital to use as starting point:
83726.48 91973.45 10.03%

Residual Income Valuations

Residual Income Valuation ($000)
Company Name KOHL'S
Most Recent Fiscal Year End 12/31/11
Date of Valuation 6/20/12
Cost of Common Equity 10.00%
Teriminal Growth Rate 3.00%
Fiscal Year of Forecast 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
(53,655,643)
Valuation to Common Equity
Net Income 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
Common Equity at Beginning of Year 17,820,000 5,555,239 5,628,555 5,713,347 5,810,082 5,919,302 6,041,626 6,177,758 6,328,490 6,494,715 6,677,431 6,877,754
Residual Income 38,205,276 39,958,307 40,560,103 41,246,686 42,021,896 42,890,128 43,856,372 44,926,262 46,106,127 47,403,055 48,824,963 50,289,712
Present Value of Residual Income 34,732,069 33,023,394 30,473,406 28,172,041 26,092,291 24,210,359 22,505,254 20,958,433 19,553,499 18,275,930 17,112,852 16,023,852
Present Value Beyond 10 Years 268,916,240
Present Value of First 10 Years 257,996,674
Common Equity as of
12/31/11 17,820,000
Forecast Equity Value Before Time Adj. 544,732,915
Forecasted Value as of Valuation Date 598,979,234
Less Value of Contingent Equity Claims 0
Value Attributable to Common Equity 598,979,234
Common Shares Outstanding at BS Date 7,154
Equivalent Shares at Valuation Date 7,154
Forecast Price/Share $83,726.48
Valuation to All Investors
Cost of Debt 8.00%
Cost of Preferred Stock 9.00%
Cost of Minority Interest 10.00%
After Tax Weighted Average Cost of Capital 9.37%
Net Interest Expense to Net Debtholders (332,012) (336,085) (340,837) (346,292) (352,481) (359,439) (367,206) (375,826) (385,351) (395,837) (407,348) (419,569)
Beginning Book Value of Debt 4,707,000 4,760,333 4,823,158 4,895,817 4,978,710 5,072,302 5,177,123 5,293,775 5,422,939 5,565,379 5,721,950 5,893,608
Residual Interest Expense (708,572) (716,912) (726,689) (737,957) (750,778) (765,223) (781,376) (799,328) (819,186) (841,068) (865,104) (891,057)
Present Value of Residual Interest Income (656,085) (614,636) (576,869) (542,420) (510,967) (482,220) (455,925) (431,852) (409,797) (389,577) (371,028) (353,851)
Value of Debt (8,377,562)
Dividends to Preferred Stockholders 0 0 0 0 0 0 0 0 0 0 0 0
Beginning Book Value of Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0
Residual Income to Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0
Present Value of Preferred Residual Income 0 0 0 0 0 0 0 0 0 0 0 0
Value of Preferred Stock 0
Minority Interest in Earnings 0 0 0 0 0 0 0 0 0 0 0 0
Beginning Book Value of Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0
Residual Income to Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0
Present Value of MI Residual Income 0 0 0 0 0 0 0 0 0 0 0 0
Value of Minority Interest 0
Net Operating Income 39,652,010 40,174,451 40,778,781 41,468,334 42,246,968 43,119,096 44,089,730 45,164,528 46,349,847 47,652,809 49,081,365 50,553,806
Beginning Net Operating Assets 22,527,000 10,315,573 10,451,713 10,609,164 10,788,792 10,991,604 11,218,749 11,471,533 11,751,429 12,060,094 12,399,381 12,771,363
Residual Income to all Investors 37,540,779 39,207,676 39,799,246 40,474,043 41,235,842 42,088,963 43,038,309 44,089,416 45,248,503 46,522,537 47,919,295 49,356,874
Present Value of Residual Investor Income 34,323,939 32,776,214 30,419,802 28,284,726 26,347,785 24,588,458 22,988,579 21,532,037 20,204,534 18,993,362 17,887,215 16,845,108
Entity Value 590,010,995
Less Value of Debt 8,377,562
Less Value of Preferred Stock 0
Less Value of Minority Interest 0
Forecast Equity Value Before Time Adj. 598,388,557
Forecasted Value as of Valuation Date 657,978,085
Less Value of Contingent Equity Claims 0
Value Attributable to Common Equity 657,978,085
Common Shares Outstanding at BS Date 7,154
Equivalent Shares at Valuation Date 7,154
Forecast Price/Share $91,973.45

DCF Valuations

DCF Valuations ($000)
Company Name KOHL'S
Most Recent Fiscal Year End 12/31/11
Date of Valuation 6/20/12
Cost of Common Equity 10.00%
Terminal Growth Rate 3.00%
Fiscal Year of Forecast 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
-53655642.8830
Valuation to Common Equity
Free Cash Flow to Common Equity 52,252,036 40,440,515 41,038,167 41,721,285 42,493,684 43,359,734 44,324,404 45,393,306 46,572,751 47,869,810 49,292,383 50,771,155
Present Value of FCF 47,501,851 33,421,913 30,832,582 28,496,199 26,385,234 24,475,439 22,745,428 21,176,312 19,751,393 18,455,884 17,276,680 16,177,255
Present Value Beyond 10 Years 271,490,679
Present Value of First 10 Years 273,242,235
Forecast Equity Value Before Time Adj. 544,732,915
Forecasted Value as of Valuation Date 598,979,234
Less Value of Contingent Equity Claims 0
Value Attributable to Common Equity 598,979,234
Common Shares Outstanding at BS Date 7,154
Equivalent Shares at Valuation Date 7,154
Forecast Price/Share $83,726.48
Valuation to All Investors
Cost of Net Debt 8.00%
Cost of Preferred Stock 9.00%
Cost of Minority Interest 10.00%
After Tax Weighted Average Cost of Capital 9.37%
Free Cash Flow to Debt (385,345) (398,910) (413,495) (429,185) (446,073) (464,260) (483,858) (504,990) (527,791) (552,409) (579,007) (596,377)
Present Value of FCF to Debt (356,801) (342,001) (328,246) (315,464) (303,590) (292,562) (282,327) (272,831) (264,027) (255,872) (248,326) (236,829)
Value of Debt (8,377,562)
Free Cash Flow to Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0
Present Value of FCF to Preferred Stock 0 0 0 0 0 0 0 0 0 0 0 0
Value of Preferred Stock 0
Free Cash Flow to Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0
Present Value of FCF to Minority Interest 0 0 0 0 0 0 0 0 0 0 0 0
Value of Minority Interest 0
Free Cash Flows to Investors 51,863,437 40,038,310 40,621,331 41,288,706 42,044,156 42,891,951 43,836,946 44,884,631 46,041,183 47,313,521 48,709,384 50,170,665
Present Value of FCF to Investors 47,419,300 33,470,595 31,048,147 28,854,042 26,864,259 25,057,566 23,415,165 21,920,398 20,558,484 19,316,291 18,182,138 17,122,848
Entity Value 590,010,995
Less Value of Net Debt 8,377,562
Less Value of Preferred Stock 0
Less Value of Minority Interest 0
Forecast Equity Value Before Time Adj. 598,388,557
Forecasted Value as of Valuation Date 657,978,085
Less Value of Contingent Equity Claims 0
Value Attributable to Common Equity 657,978,085
Common Shares Outstanding at BS Date 7,154
Equivalent Shares at Valuation Date 7,154
Forecast Price/Share $91,973.45

EPS Forecaster

EPS Forecaster ($000, except per share amounts)
Company Name KOHL'S
Common Shares Outstanding at BS Date 7,154
Equivalent Shares at Valuation Date 7,154
Forecasted Price at Valuation Date $83,726.48
Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
Fiscal Year of Forecast 2012/12/31 2013/12/31 2014/12/31 2015/12/31 2016/12/31 2017/12/31 2018/12/31 2019/12/31 2020/12/31 2021/12/31 2022/12/31 2023/12/31
Net Income 39,987,276 40,513,831 41,122,958 41,818,020 42,602,904 43,482,058 44,460,535 45,544,038 46,738,976 48,052,526 49,492,706 50,977,487
Common Equity Issued (Repurchased) (52,252,036) (40,440,515) (41,038,167) (41,721,285) (42,493,684) (43,359,734) (44,324,404) (45,393,306) (46,572,751) (47,869,810) (49,292,383) (50,771,155)
Forecasted Price at Year End $88,145.38 $96,959.91 $106,655.91 $117,321.50 $129,053.65 $141,959.01 $156,154.91 $171,770.40 $188,947.44 $207,842.19 $228,626.41 $251,489.05
New Shares Issued (Repurchased) (593) (417) (385) (356) (329) (305) (284) (264) (246) (230) (216) (202)
Shares Outstanding at End of Year 6,561 6,144 5,759 5,404 5,074 4,769 4,485 4,221 3,974 3,744 3,529 3,327
Forecast EPS $5,831.09 $6,377.46 $6,909.41 $7,492.20 $8,131.72 $8,834.69 $9,608.73 $10,462.58 $11,406.24 $12,451.21 $13,610.72 $14,872.81
Consensus Analyst Forecast of EPS
Forecast Five Year Growth Rate in EPS 9%
Consensus Analyst Forecast of Growth Rate
To obtain analyst forecasts, click here
Although not a necessary input for eVal, we recommend that you find the analyst forecasts for your company and store them in the yellow-shaded cells for comparison purposes.

Model Summary

Model Summary
Historical Data For:
KOHL'S
Most Recent Fiscal Year End: 2011/12/31
Average ROE (last five years) 159.08%
Sales Growth (last five years) 0.53%
Forecast Data:
Forecast Horizon 10 years
This Year's ROE 342.13%
Terminal Year's ROE 730.24%
This Year's Sales Growth 1.13%
Terminal Year's Sales Growth 3.00%
This Year's Forecast EPS $5,831.09
Forecast 5 Year EPS Growth 8.66%
Valuation Data:
Cost of Equity Capital 10.00%
Valuation Date 2012/06/20
Estimated Price/Share $83,726.48
Estimated Price/Earnings Ratio 14.36
Estimated Market/Book Ratio 33.61