Bullish Case: Kohl's new CEO's focus on digital transformation could revitalize sales. Strategic partnerships, like the Sephora collaboration, show potential for driving traffic and increasing revenue in-store, presenting opportunities for recovery.

Bearish Case: Kohl's continues struggling with declining sales and high competition. Store closures and leadership changes add uncertainty, while high volatility indicates market concern over stability and future performance.

Potential Outcomes: 30% chance of recovery via digital strategy, 50% risk of decline from sales and competition, 20% chance of flat performance amid volatility spikes.

Trading Oracle: Consider entering a bullish debit spread. Target near-term recovery with KSS $13.50 calls and $14.00 calls, expiring in February. High volume in call options suggests optimism, capturing potential upside while managing risk. Volatility spikes offer an optimal entry.

January 26, 2025