NEW YORK — Retail powerhouses Target Corp. and J.C. Penney Co. Inc. offered bullish outlooks on consumer spending as they reported fourth-quarter profits that beat Wall Street estimates. Both are counting on improved merchandise assortments to lure shoppers away from rivals.

Discounter Target — helped by strong holiday sales and an increasing contribution from its credit card division — reported a 14 percent rise in profits in the fourth quarter.

The Minneapolis-based company expects same-store sales, or sales at stores open for at least a year, to rise 4 percent to 6 percent this year, compared to the 5.6 percent gain in its last fiscal year.

Penney said that its profit jumped 65 percent in the fourth quarter buoyed by strong sales in stores and online as well as a one-time tax gain. The department store retailer offered a profit outlook that beat Wall Street expectations and announced a 44 percent dividend increase and $750 million more to repurchase shares.

Despite higher energy costs, "consumer spending is holding up remarkably well. The job market is solid, which has given a floor to consumer spending," said Ken Perkins, president of Retail Metrics LLC, a research firm in Swampscott, Mass.

Target said that for the three months ended Jan. 28, net income rose to $939 million, or $1.06 per share, from $825 million, or 91 cents, the year before. That just beat the $1.05 estimate from analysts polled by Thomson Financial.

Target shares fell $1.21, or 2.2 percent, to close at $54.59 on the New York Stock Exchange, as investors appeared to be disappointed with its gross profit margins. Shares have traded in a 52-week range of $45.55 to $60.

Quarterly revenue of $16.95 billion was up 12 percent from $15.19 billion a year earlier, and slightly above Wall Street's consensus target of $16.87 billion. The company reported a 4.2 percent increase in same-store sales.

Meanwhile, Penney, based in Plano, Texas, said it earned $551 million, or $2.34 per share, compared to $333 million, or $1.17 per share, a year earlier.

Excluding gains from tax adjustments related to the sale of the Eckerd drugstore chain and another one-time tax gain, Penney would have earned $1.71 per share.

Analysts had expected Penney to earn $1.63 per share in the most recent quarter, according to a survey of analysts by Thomson Financial.

Penney's shares gained $1.22, or 2.2 percent, to close at $57.85 on the New York Stock Exchange. The shares briefly rose as high as $58.82, their best level in more than seven years

Revenue rose 4.2 percent, to $6.20 billion. Analysts expected $6.19 billion.

Same-store sales rose 2.6 percent in the quarter ended Jan. 28.

Contributing: David Koenig; Joshua Freed