Kohl’s Corp. gave an upbeat sales outlook and announced plans to reinstate its dividend, bolstering management and its strategy amid pressure from a group of activist investors.

The retailer says 2021 net sales will grow by a percentage in the mid-teens — while investors can expect the return of a dividend and share buybacks. The shares rose 2.1 percent at 12:12 pm in New York, extending earlier gains.

“The company is clearly on a trajectory to recovery,” Neil Saunders, managing director of GlobalData, said in an emailed statement. “It is also performing far better than most other department stores, which is both a function of the location of its shops and the effort it has put into developing its offer.”

The results show signs that Kohl’s new strategy is gaining traction. The retailer is focusing on categories like sportswear, outdoor apparel and beauty and has teamed up with Sephora for in-store shops, which it says will help drive store traffic. Its partnership to accept returns from Amazon.com Inc. customers is already increasing foot traffic and bringing in younger shoppers, Chief Executive Officer Michelle Gass said.

A group of activists, which include Macellum Advisors GP LLC and Ancora Holdings Inc., have said a more comprehensive overhaul is needed. They are seeking nine board seats and have said the company should cut back its inventory and stop offering “promotional gimmicks.”

In an interview on Tuesday, Gass reiterated that she and the board are “open to all ideas that can help us create shareholder value” but doesn’t support adding nine directors to the board.

‘Sensible Avenues’

Saunders said the company “has been proactive and diligent in its activities and has sought sensible avenues for growth.”

“We completely reject the argument that Kohl’s is a badly run business. It simply is not,” Saunders said. “Under the leadership of Michelle Gass, Kohl’s has put in place many initiatives that have allowed the company to outperform its peer group.”

Nonetheless, Kohl’s isn’t escaping Covid-19 unscathed. When the retailer released 2020 guidance last March just ahead of the pandemic, it estimated earnings per diluted share of $4.20 to $4.60 for that year. For 2021, it sees that measure at just $2.45 to $2.95. Gass referred to 2021 as a “building block” to get the retailer to its 2023 goals.

Kohl’s executives don’t expect an immediate bounce-back to pre-pandemic sales levels. The company sees the second half of 2021 strengthening — which echos the views of other retailers such as Macy’s Inc. As the vaccine rollout continues to expand, there are expectations that consumers will spend more freely in areas that they’ve neglected during the long period of social distancing.

Kohl’s also reported year-end sales results Tuesday, but investors shouldn’t be surprised by the numbers: The company said in early February preliminary fourth-quarter results showed an 11 percent decline in same-store sales and 10 percent drop in total revenue.

By Jordyn Holman