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Dollar General Corporation (DG) is scheduled to report its Q2 2012 results on September 5, 2012, before market opens. The Street expects EPS and revenue of $0.60B and $3.82B, respectively.

In this article, I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from Dollar General Corporation and the news from its closest competitors.

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Recent EPS Actuals vs. Estimates

The company has met or beaten analysts' estimates in the last three quarters. In the last quarter, it reported $0.87 EPS, beating analyst estimates of $0.82.

The consensus EPS estimate is $0.60 based on 23 analysts' estimates, up from $0.48 a year ago. Revenue estimates are $3.82B, up from $3.45B a year ago. The median target price by analysts for the stock is $60.00.

Average recommendation: Overweight

Source: Marketwatch

Analyst Upgrades and Downgrades

  • On June 28, 2012, Avondale reiterated Mkt Outperform rating for the company.
  • On March 23, 2012, FBR Capital reiterated Outperform rating for the company.
  • On March 23, 2012, Barclays reiterated Overweight rating for the company.
  • On March 22, 2012, MKM Partners upgraded the company from Neutral to Buy.
  • On March 20, 2012, Avondale reiterated Mkt Outperform rating for the company.

Latest News

  • On June 28, 2012, Dollar General Corporation announced the pricing of an offering of $500 million of its 4.125% Senior Notes due 2017 (the Notes). The Notes, which are fully and unconditionally guaranteed on a senior unsecured basis by each domestic subsidiary of Dollar General that guarantees its senior secured credit facilities, will pay interest at a rate of 4.125% per annum semi-annually on January 15 and July 15 of each year, commencing January 15, 2013.
  • On June 4, 2012, Dollar General Corporation announced that it continues to expect total sales for fiscal 2012 to increase 8% to 9% over the 53-week fiscal 2011, or 10% to 11% on a comparable 52-week basis.
  • On March 22, 2012, Dollar General Corporation announced that for fiscal 2012, it expects total sales to increase 10% to 11% on a comparable 52-week basis, Same-store sales, based on a comparable 52-week period, are expected to increase 3% to 5%, operating profit (EBIT) is expected to be between $1.60 and $1.65 billion.

Competitors

Big Lots, Inc. (BIG), Dollar Tree, Inc. (DLTR), Family Dollar Stores Inc. (FDO), Fred's, Inc. (FRED), and Wal-Mart Stores, Inc. (WMT) are considered major competitors for Dollar General and the table below provides the key metrics for these companies and the industry.

Dollar General Corporation key ratio comparison with direct competitors

The chart below compares the stock price changes as a percentage for the selected companies for the last one-year period.

DG Chart

DG data by YCharts

Competitors' Latest Development

  • On August 23, 2012, Big Lots Inc announced that for fiscal 2012, it expects consolidated adjusted income from continuing operations to be in the range of $2.80 to $2.95 per diluted share (non-GAAP), compared to the prior guidance of $3.25 to $3.40 per diluted share (non-GAAP).
  • On August 17, 2012, Reuters reported that an Indiana union pension fund that holds shares in Wal-Mart Stores Inc has sued the Company to gain access to thousands of internal documents related to allegations that a Wal-Mart subsidiary bribed Mexican government officials.
  • On August 16, 2012, Dollar Tree Inc announced that for third quarter of 2012, it expects sales in the range of $1.71 billion to $1.75 billion, based on low to mid single digit positive comparable store sales.
  • On August 16, 2012, Wal-Mart Stores Inc announced that for third quarter of 2012, it expects diluted earnings per share (EPS) from continuing operations to range between $1.04 and $1.09. This compares to last year's third quarter reported EPS of $0.97. For fiscal 2012, it expects EPS guidance to a range of $4.83 to $4.93. Previous range was $4.72 to $4.92. According to I/B/E/S Estimates, analysts were expecting the company to report EPS of $1.05 for third quarter of 2012 and EPS of $4.93 for fiscal 2012.
  • On June 28, 2012, Family Dollar Stores, Inc. announced that for fourth quarter of 2012, it expects comparable store sales to increase between 5% and 7% and that earnings per diluted share to be between $0.71 and $0.81, compared with $0.66 in the fourth quarter of fiscal 2011.
  • On June 12, 2012, The Economic Times reported that Wal-Mart Stores, Inc. plans to snap ties with companies that supply products to its stores if they are involved in any kind of corrupt practices, making it the first retail company to undertake such a stringent initiative in India.
  • On June 11, 2012, Reuters reported that New York City's pension funds became the latest group to file a derivative lawsuit against Wal-Mart Stores Inc based on reported allegations of bribery in Mexico and a possible cover-up by Wal-Mart officials.

Technical Overview


The stock has a market capitalization of $16.97B and is currently trading at $51.07 with a 52-week range of $34.22-$56.04. The stock's year-to-date performance has been 24.14%. It is currently trading above 20 and 200 SMA, but below 50 SMA.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Source: Earnings Preview: Dollar General Reports On September 5