Dollar General Corp. (ticker: DG) continued the strong quarter for U.S. discount retail stores by reporting modest earnings and revenue beats on Thursday morning. The stock jumped more than 4.5 percent in early trading.
Dollar General reported first-quarter adjusted earnings per share of $1.03 on revenue of $5.61 billion. Both numbers beat consensus analyst forecasts of $1 and $5.59 billion, respectively. Same store sales for the quarter were up 0.7 percent.
Dollar General maintained its previous full-year EPS guidance of $4.25 to $4.50. The company is also calling for full-year sales growth of 5 to 7 percent.
“For the first quarter of 2017, I am pleased with our earnings results, which reflect solid management of the business in a difficult retail environment as we overcame our most challenging comparisons from the prior year,” CEO Todd Vasos says. “Our same-store sales improved as we moved past the delay in income tax refunds and the timing shift of the Easter holiday.”
While full-price retailers such as Macy’s (M), J.C. Penney Co. (JCP) and Nordstrom (JWN) all disappointed investors in the first quarter, discount retailers Dollar General, Big Lots (BIG), Wal-Mart Stores (WMT) and others have all reported strong numbers. Macy’s chief financial officer Karen Hoguet says the pattern is no coincidence.
“The bigger challenge for us has not been the internet, it’s been off-price,” Hoguet says on Macy’s earnings call. “We’ve spent a lot of time trying to make our experience better vis-a-vis the off-price retailers because I think that’s been the bigger competitive threat for us over time.”
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