By Dhirendra Tripathi

Investing.com – Guess (NYSE:) stock climbed 8% Thursday after the retailer posted better fourth quarter margins than anticipated, persuading traders to ignore the misses on both sales and profit fronts.

Adding to the gains is the company’s plan to do a $175 million accelerated share repurchase.

In the fourth quarter, adjusted operating margin rose by 3.6% to 15.7% due to lower markups, less discounts and higher occupancy costs. As demand remains high, retailers have been able reduce discounts while inventory is stabilizing.

These gains were partly offset by the lower European comparable sales and increased inbound freight costs.

The company anticipates that 2023 revenues will grow low single digits, as long as there are no significant COVID-related shut downs. Although it expects a decline in operating margin, the company still believes that it will be close to 10% for the entire year. In 2022, revenue was $2.6 Billion.

The fourth quarter’s revenue fell 5% to $800 millions, and the price was $1.14.

CEO Carlos Alberini said the company’s 26% return on invested capital for the year is the highest it has been in ten years.

“Our balance sheet is strong, and we plan to use our capital opportunistically to return value to our shareholders through dividends and increased share repurchases.”

A quarterly dividend will be paid by the company at 22 cents.

Company expects to see an increase in revenue for the current quarter of the year, which will be low teens.