Kohl's Corporation (NYSE:KSS) shares closed almost 13% lower on Monday following the company’s Investor Day. Analysts at Deutsche Bank provided their key takeaways from the event.

According to the analysts, currently, the company is different from what it was pre-pandemic and the analysts expect the ongoing profitability to be driven by (1) growth in active and casual categories, (2) the Sephora partnership, which is expected to drive $2 billion in sales, (3) smaller new format stores, (4) improved inventory allocation and pricing optimization, and (5) marketing efficiency and further labor automatization.

While the analysts believe the company’s new financial framework underwhelmed investors as there was no change to the prior operating margin outlook of 7-8% that was first provided in October 2020, the analysts believe management is taking a prudent approach given a number of headwinds, including (1) cost inflation, (2) elevated freight expenses, (3) wage investments, and (4) increasing digital penetration.