- Dollar General‘s third-quarter earnings per share (EPS) were $0.89, missing expectations of $0.95 and down from $1.26 in the same quarter last year.
- Net sales increased by 5% year-over-year to $10.18 billion, slightly above the expected $10.14 billion.
- The gross margin for the quarter was 28.8%, compared to 29% last year, but better than the estimated 28.4%.
- Selling, General, and Administrative (SG&A) expenses as a percentage of revenue rose to 25.7% from 24.5% last year, surpassing the estimated 24.8%.
- Operating profit was $323.8 million, reflecting a 25% decrease from the previous year, and below the expected $341.2 million.
- Year-to-date, Dollar General saw square footage growth of 5.1% and a net addition of 537 stores.
- CEO Todd Vasos attributed some of the third-quarter results to the company’s “Back to Basics” efforts, improving store execution and customer experience.
- The company faced challenges during the quarter due to hurricanes, yet the team’s performance remained commendable.
- Market analysts show mixed sentiments with 10 buy ratings, 19 holds, and 2 sells on the company’s stock.
Dollar General on Smartkarma
Smartkarma, an independent investment research network, has seen a mix of analyst sentiments regarding Dollar General. MBI Deep Dives provided a bullish outlook in their report titled “Some More Thoughts on Dollar General,” expressing positive thoughts after concerns about the company’s near-term prospects. Despite this optimism, the analyst chose not to inject more capital but increase notional exposure via long-dated call options.
On the other hand, Baptista Research‘s report, “Is Dollar General in Trouble? New Outlook, ‘Financially Constrained’ Customers Spark Major Concerns!,” took a bearish stance. They highlighted Dollar General‘s financial struggles, with a significant downgrade in sales and profit forecasts, leading to a plummet in the company’s shares. This contrasting sentiment reflects the varying perspectives within the analyst coverage on Dollar General‘s current situation and future performance.
A look at Dollar General Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 4 | |
| Growth | 3 | |
| Resilience | 2 | |
| Momentum | 2 | |
| OVERALL SMART SCORE | 2.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
When looking at the Smartkarma Smart Scores for Dollar General, the discount retail chain seems to have a promising long-term outlook. With a solid score of 4 for Dividend and 3 for both Value and Growth, Dollar General appears to be well-positioned in terms of providing returns to investors while maintaining a good balance between growth and value. However, the company’s lower scores of 2 for both Resilience and Momentum indicate some areas that may need attention to ensure sustained performance.
Dollar General Corporation, known for its chain of discount retail stores primarily in the United States, offers a wide range of products from consumables like food and cleaning supplies to non-consumables and seasonal items. Despite facing challenges in resilience and momentum, the company’s strong emphasis on dividends and a decent balance between value and growth suggest a potentially stable future for investors willing to hold onto their positions for the long term.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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