Kohl’s issues better-than-expected 2022 outlook as margins weather supply chain challenges

The Kohl’s logo is displayed on the exterior of a Kohl’s store on January 24, 2022 in San Rafael, California.

The company reported fourth-quarter sales that came in below analysts' estimates, but investors were reassured by the company's upbeat revenue outlook for the next four years.

The company's strategy to sell more goods at full price points helped it beat estimates. The CEO said that the operating margin was 8.6%, two years ahead of schedule, despite supply chain challenges and other pressures.

Net sales are expected to rise 2% to 3%. Analysts had been looking for a growth of 2%.

In 2022, Gass said in a statement, will build on our momentum. She said that the company plans to use its recent partnership with Sephora to open shop-in-shops at hundreds of its stores.

The report comes at a time when activists are pushing for a sale and one group is looking to take control of the retailer's board. The takeover offers that were on the table were rejected by the company.

According to a survey of analysts by Refinitiv, Kohl's did better than Wall Street anticipated in the fourth quarter.

• Earnings per share: $2.20 adjusted vs. $2.12 expected
• Revenue: $6.22 billion vs. $6.54 billion expected

Net income fell to $299 million, or $2.20 a share, for the three-month period ended January 29, compared with $343 million, or $2.20 per share, a year earlier. The earnings beat analysts' estimates of $2.12 a share.

Net sales increased to $6.22 billion from $5.88 billion. It was less than estimates for $6.54 billion.

The active wear business grew more than 40% in 2021. The retailer has private labels for items such as leggings, sports bras and hoodies and sells goods from top brands.

The category of activewear has grown due to more consumers looking for comfort during the Pandemic and investing in their workout routines.

On top of its sales targets, the company sees earnings per share in the range of $7.00 to $7.50, compared with analysts expectations of $6.55 a share.

The company plans to double its annual dividend and buy back at least $1 billion of its stock this year.

The company will hold an investor meeting on Monday where it will give more guidance around its longer-term financial targets.

The company's market cap has increased to $ 7.7 billion as of Monday's market close.

There is a developing story. You can check back for updates.

You can find the full earnings press release here.