Kohl's shares may underperform because cold weather kept customers from visiting stores during the first quarter, according to one Wall Street firm.
Credit Suisse cut its rating to neutral from outperform for Kohl's shares, predicting the retailer will report lower-than-expected sales growth for its first quarter.
A much cooler start to spring compared to the last two years " likely put pressure on early Spring apparel selling," analyst Michael Binetti wrote in a note to clients Friday entitled "A Tougher 2018 Path with Near-Term Momentum Risks."
"And with Kohl's typically the most weather-sensitive vs. department store peers, we see risk" to its first quarter sales, he said.
The company's shares declined 1.7 percent Friday after the report.
Binetti reduced his price target for Kohl's shares to $64 from $72. The new target is still 6 percent higher than Thursday's closing price.
The analyst predicts Kohl's will report first-quarter same-store sales growth of 2.5 percent, while the consensus of analysts forecasts 2.7 percent.
U.S. retail industry store traffic fell 2.7 percent in the first quarter compared to the same period last year, according to data tracker Prodco. That is worse than the 1.9 percent decline in traffic in the fourth quarter. The analyst noted the store traffic numbers historically are highly correlated to department store sales.
Kohl's is slated to report its first-quarter earnings results on Tuesday, May 22.
The company did not immediately respond to a request for comment.
— CNBC's Michael Bloom contributed to this story.