By Dhirendra Tripathi
Investing.com – Kohls stock (NYSE:KSS) traded 3% higher in premarket trading on Tuesday after the retailer’s 2022 guidance came in ahead of estimates amid signs its efforts to attract a younger audience are gaining traction.
Higher margins in the fourth quarter reflected a successful management of supply chain shortages by the company. Established brands like Calvin Klein and Tommy Hilfiger and popular labels like Sephora, Cole Haan and Eddie Bauer drew in shoppers.
“In 2021, we delivered all-time record earnings per share, significantly ahead of our expectations. Our operating margin of 8.6% exceeded our 2023 goal two years ahead of plan, a direct result of our efforts to restructure the business to be more profitable,” CEO Michelle Gass said in a statement.
The company kept up with its plan to roll out 850 ‘Sephora at Kohl’s’ stores by 2023, an attempt to position the company as a beauty destination. At these stores, customers can explore an assortment of prestige makeup, skincare, hair, and fragrance brands.
According to Reuters, the company offered lower promotions and limited some of its weaker private label brands to shield profits from soaring freight expenses during the quarter.
The company has doubled its annual dividend while also proposing to buy back shares worth up to $3 billion. This includes a $1 billion exercise in 2022, of which $500 million could be through an accelerated program in the second quarter.
Kohl’s expects adjusted profit per share of $7 to $7.50 in the year while revenue is seen growing 2% to 3%. In the recent year, the company posted an adjusted EPS of $7.33 on revenue of over $19 billion.
Fourth-quarter total revenue rose about 6% to $6.5 billion. Adjusted EPS fell by 2 cents to $2.20.