(Adds analyst comment, industry background, updates shares)
By Vibhuti Sharma
Jan 8 (Reuters) - Kohl's Corp reported far stronger same-store sales in November and December than its peers, vindicating the company's tweaks to its business and offering more evidence of a strong Christmas for retailers.
Kohl's shares rose as much as 8.7 percent on Monday and were on track to open at their highest in over a year following the sales performance that puts it on track for its best holiday quarter in three years. Shares of larger rival Macy's also rose 1.3 percent.
The company's 6.9 percent rise in sales at stores open for at least a year topped the 1-4 percent growth posted by J.C. Penney Co Inc and Macy's Inc.
It also followed a report by MasterCard Advisors in late December that showed shoppers spent more than $800 billion in stores and online between Nov. 1 and Dec. 24, a new record.
Kohl's has sought to revamp its beauty departments and bring in popular brands such as Under Armour, while also partnering directly with Amazon.Com.
"Kohl's has an excellent mix of low price private label apparel offerings coupled with plenty of desirable national brands compared to Macy's and Penney," said Ken Perkins, president of industry research firm Retail Metrics.
Store checks conducted by the firm found Kohl's to be one of the busiest department store chains during the holiday season, underscoring a 2017 theme that showed retailers not based in malls were generating better traffic.
"Even if Kohl's has a very weak January the department store chain is poised to turn in its strongest quarterly same store sales gain in at least 3 years when it racked up a 3.7 percent gain in the fourth quarter of 2014," Perkins said.
Kohl's said it now expects its fiscal 2017 diluted earnings per share to come in between $4.10 and $4.20, versus its previous forecast of $3.72 to $3.92. Analysts on average expect the company to report a profit of $3.64 for the year, according to Thomson Reuters I/B/E/S.
The company said its forecast does not include the impact of recent changes in the tax code, which are expected to have a positive impact on its effective tax rate.
Separately, Canadian yoga and leisure apparel maker Lululemon Athletica Inc also posted strong holiday season sales and raised its full-year forecasts. Its shares were up 2.7 percent premarket on Monday. (Reporting by Vibhuti Sharma in Bengaluru; Editing by Saumyadeb Chakrabarty)