Kohl’s expects to reach $24 billion in sales and a net income of about $1.9 billion by 2010, nearly tripling its current sales volume.
The company will open 65 stores on Thursday for the largest one-day expansion in the department store’s history. Kohl’s will open another three stores next month.
Shares for the retailer rallied on the news, closing Wednesday at $69.14, up 2.38 percent from Tuesday’s close. As of Sept. 30, the department store had rung up sales of $8.87 billion this year.
Kohl’s outlined its long-term growth plan during a presentation to analysts in Tampa, Fla. Though the numbers seem staggering, analysts believe they are achievable.
“I see the company’s projected growth as entirely possible. They have developed a nice growth engine there in recent years, and to get to that path, while it might be a little stretch, is not impossible,” said Craig Johnson, president of Consumer Growth Partners.
Johnson said there was strong potential for geographical expansion, especially in the Southwest and Northwest
As part of its five-year strategic growth plan, Kohl’s plans to open about 415 stores across the county over the next four years, with a goal of more than 1,200 stores by 2010.
Kohl’s reported on Tuesday that September same-store sales increased 16.3 percent, and raised guidance for the third quarter by 3 cents, from 56 cents to 59 cents per share.
Besides store expansion, the five-year plan includes broader marketing and merchandising initiatives, such as collaboration with designers to offer exclusive in-store items.
“They have been able to maintain a nice record of sales productivity and are trying to differentiate themselves by providing a superior customer experience, both in the stores and in terms of accessibility,” Johnson said. “With these initiatives and a solid management team, I have good confidence they will reach what some people may call far-fetched growth.”