* 4th-qtr comp sales grow 1.9 pct vs est $1.5 pct
* Shares rise as much as 4 pct
(Adds details from conference call, updates shares)
By Sruthi Ramakrishnan
Feb 24 (Reuters) - Target Corp's TGT.N quarterly sales at
established stores topped analysts' estimates as its initiatives
around higher-profit items drove traffic, showing that the
company's turnaround efforts under CEO Brian Cornell were
gaining traction.
The U.S. retailer, whose shares rose as much as 4 percent to
$76.95, also forecast a higher-than-expected adjusted profit for
the full year.
Same-store sales at rival Wal-Mart Stores Inc (N:WMT) WMT.N missed
market expectations last week, hurt by a strong dollar and
sluggish apparel demand.
Target's apparel sales rose in the fourth quarter, in
contrast to weak sales at several retailers including Ralph
Lauren Corp RL.N and Nordstrom Inc (N:JWN) JWN.N .
Cornell, Target's chief executive since August 2014, has
been aggressively trying to turnaround the company after several
years of sluggish growth.
Some of his efforts include promoting and investing in a
narrower set of higher-margin "signature" categories such as
baby and health and wellness, and pulling out of Canada.
Comparable sales in higher-margin categories rose by more
than three times the company average in the quarter ended Jan.
30, Target said, with women's apparel, wearable electronics and
food being the fastest growing.
"Signs that CEO Cornell's strategic initiatives are gaining
traction include: 'signature' categories re-accelerating to
about 6 percent growth and traffic rising 1.3 percent," Sterne
Agee analyst Renato Basanta said.
Apparel sales were helped by better in-store and online
presentation and the stocking of trendier styles, Target finance
chief Cathy Smith said on a media call.
"We believe that Target performed somewhat above the market
(in apparel) thanks to its more fashion-savvy shopper
demographic and its strong marketing efforts around holiday
looks," Neil Saunders, CEO of research firm Conlumino, wrote in
a note.
Concerns about a slowdown in Target's digital sales were
also alleviated by its 34 percent growth in the quarter, Sterne
Agee's Basanta said, terming it "solid progress for Target's
still nascent platform."
The concerns stem from Target's warning in November that it
would miss its target of growing online sales by 40 percent in
2015 due to slowing electronic sales.
Sales at Target stores open at least 13 months increased 1.9
percent in the quarter, beating the 1.5 percent rise analysts
had expected.
Excluding items, Target earned $1.52 per share, missing the
average estimate by 2 cents, due to promotions.
Total sales fell 0.6 percent to $21.63 billion, mainly due
to the sale of its pharmacy business to CVS Health Corp (N:CVS) CVS.N .
Analysts had expected sales to remain flat.