Dollar General CorporationNYSE
Tue, Dec. 6, 11:10 AM
- The grocery store sector has 2K reasons to worry after the WSJ reported yesterday that number of brick-and-mortar locations are being planned by the Seattle e-commerce giant.
- Though Amazon's Project Como has been an overhang for the sector for a while, the volume of stores being considered and the differing formats (drive-through, premium) is an eye opener.
- Whole Foods Market (WFM -1.4%), Sprouts Farmers (SFM -1.1%), Kroger (KR -0.7%), Village Super Markets (VLGEA -1.3%) and Weis Markets (WMK -0.9%) are all lower on the day.
- Dollar General (DG -0.7%) and Dollar Tree (DLTR -0.3%) are also down slightly.
- Previously: Retail heavyweights to keep a watch on Amazon Go (Dec. 5)
- Previously: Amazon reportedly developing multiple grocery store formats, prospect for over 2,000 locations cited (Dec. 5)
Thu, Dec. 1, 7:05 AM
- Dollar General (NYSE:DG) reports same-store sales fell 0.1% during a "challenging" Q3.
- The retailer saw strength in consumables and weakness in the apparel, seasonal and home products categories.
- Gross margin fell 49 bps to 29.8% of sales as higher markdown took a toll.
- SG&A expenses were up 50 bps to 22.5% of sales.
- Inventort +5.6% Y/Y to $3.49B.
- The company paid an effective tax rate of 36.2% in Q3 vs. 37.0% a year ago.
- "We saw an acceleration in headwinds from average unit retail price deflation and reductions in SNAP benefits," says CEO Todd Vos on the quarter.
- Previously: Dollar General misses by $0.04, misses on revenue (Dec. 1)
- DG -4.94% premarket to $73.50.
Thu, Dec. 1, 6:59 AM
Wed, Nov. 30, 5:30 PM
Wed, Nov. 30, 2:14 PM
- Retail Metrics: The retail industry specialist expects chain stores to report a 1.1% increase in comparable sales during November. The estimate on October retail comparable sales was revised up to 1.5% from 1.0%. Both marks arrive against a deflation and low traffic headwind in the sector.
- NPD Group: The research firm plays meteorologist by warning that the lack of "true" winter weather will hit some apparel and shoe sellers.
- FBR Capital: The firm points to a strong month for Bath & Body Works (NYSE:LB).
- Piper Jaffray: The retail analyst team is cautiously optimistic that Costco (NASDAQ:COST) is off to a good start.
- November has been a stellar month for Target (NYSE:TGT) and Best Buy (NYSE:BBY), up 16% and 18% respectively. Both retailers trade with a ~14 forward PE ratio which has some traders buzzing that's still room left to run.
- Amazon dominated a lot of the Black Friday and Cyber Monday talk, but it was Wayfair (W +4.6%) that may have posted the most impressive online sales growth vs. expectations. Shares of Wayfair are still 28% below their 52-week high, although valuation isn't for the feint of heart.
- At home on Seeking Alpha, there's been some good discusssion on the impact of the reduction of SNAP benefits (nutrition assistance) in the U.S. on the retail sector. Tomorrow's earnings report from Dollar General (NYSE:DG) and the firm's conference call Q&A could shine a light on that wildcard.
- Retail ETFs: XLY, XRT, VCR, RTH, RETL, FXD, FDIS, RCD, PMR, CNDF, FTXD, JHMC, IBUY.
- Previously: Black Friday channel checks show pockets of strength (Nov. 28)
- Previously: Department store sales in positive territory for November (Nov. 29)
- Previously: Cyber Monday wrap and retail outperformers (Nov. 29)
Tue, Nov. 29, 10:06 AM
- Cyber Monday online sales increased 12.1% to $3.45B, according to an updated tally from Adobe.
- Mobile spending was up 34% Y/Y to $1.07B to account for 31% of sales.
- Conversion rates were highest for desktops at 6.3%, while smartphones (2.8%) and tablets (5.1%) were still above holiday averages.
- Holiday shopping season sales through November 28 are up 7.6% to $39.97B.
- The S&P Retail ETF (NYSEARCA:XRT) is up 1.81% over the last week to outpace broad market averages. The list of outperformers over the last week -- which factors in the pre-Thanksgiving buzz, Black Friday reports, and Cyber Monday numbers -- includes Target (NYSE:TGT), Wal-Mart (NYSE:WMT), Hasbro (NASDAQ:HAS), Mattel (NASDAQ:MAT), Staples (NASDAQ:SPLS), DSW (NYSE:DSW), Barnes & Noble (NYSE:BKS), Dollar Tree (NASDAQ:DLTR), Dollar General (NYSE:DG), Burlington Stores (NYSE:BURL), The Children's Place (NASDAQ:PLCE) and Best Buy (NYSE:BBY). An interesting sidenote is that all the retail names listed above topped the return of Amazon for the 5-session period.
Fri, Nov. 25, 12:34 PM
- Credit Suisse thinks the dollar store sector could benefit if the legal challenge to extending overtime pay benefits to workers making up to $47K holds up.
- “Dollar stores would have been most heavily impacted by the new overtime rule given the sheer number of stores they operate and their unique low-cost labor model,” reads the CS note.
- “With only two to three employees per store typically working at any given time, store managers comprise a significant percentage of store labor and generally work heavy overtime.”
- Beyond Dollar General (DG +0.6%) and Dollar Tree (DLTR +0.1%) -- a list of companies that could benefit from the OT rules staying the same includes Five Below (FIVE -1.6%), Big Lots (BIG -0.5%) Fred's (FRED -1.2%) and Ollie's Bargain Outlet Holdings (OLLI -0.2%).
- Previously: New DOL overtime rule in state of flux (Nov. 25)
Fri, Nov. 25, 7:54 AM
- Millions of workers poised to start earning overtime pay next week are now in limbo after a federal judge in Texas blocked new wage rules set by the Department of Labor with a temporary injunction.
- The new DOL rule raised the exemption for OT pay to $47,476 in annual pay, from the current level of $23,360, impacting a huge number of workers in the retail industry.
- Piper Jaffray says it's uncertain how the Obama administration will react. It's also unclear if major companies have the ability to quickly pull back on the new OT rules set to go into effect on December 1 due to the programmed changes in their payroll and IT systems.
- The investment firm says the retailers most affected by overtime changes include Dollar General (NYSE:DG), Dollar Tree (NASDAQ:DLTR), Sally Beauty Holdings (NYSE:SBH), Regis Corporation (NYSE:RGS), Bojangles (NASDAQ:BOJA), Starbucks (NASDAQ:SBUX), Sonic (NASDAQ:SONC), Noodles (NASDAQ:NDLS), Potbelly (NASDAQ:PBPB), Del Taco (NASDAQ:TACO) and Zoe's Kitchen (NYSE:ZOES).
- Source: Bloomberg
Tue, Nov. 22, 10:01 AM
- Dollar Tree (NASDAQ:DLTR) is up 11% after delivering a solid quarter that included an increase in Family Dollar acquisition benefits.
- Burlingon Stores (NYSE:BURL) races 15% higher after its Q3 results topped expectations.
- DSW (DSW +7.5%) and Chico's (CHS +7.3%) also turned in solid reports to round out the good cheer in the sector.
- Other retailers on the move include Dollar General (DG +3.1%), Big Lots (BIG +3.8%), Ollie's Bargain Outlet Holdings (OLLI +1.9%), American Eagle Outfitters (AEO +3.5%), Five Below (FIVE +2.8%), and Fred's (FRED +1.8%).
- Even the bigger chains are bringing in buyers, with Target (TGT +1.3%), Wal-Mart (WMT +1.5%), Staples (SPLS +1.8%) and Office Depot (ODP +3.2%) all ahead of broad market averages.
- The general theme in the retail sector today is margin improvement as some merchandise and operational costs were shown to have been reeled in to improve profitability.
Mon, Nov. 14, 8:00 AM
- Barron's points to a handful of companies which could benefit significantly from a lower corporate tax rate in the future as a result of the GOP election sweep last week.
- Altria Group (NYSE:MO), CSX (NYSE:CSX), Dollar General (NYSE:DG), Kohl's (NYSE:KSS) and CVS Health (NYSE:CVS) all paid out effective tax rates of over 36% during the last five years.
Wed, Nov. 9, 6:47 AM
- Voters in Arizona, Colorado and Maine voters approved boosting the minimum wage in their states to $12 per hour. Each state will see the hikes make their way to the $12 level after a series of graduated increases.
- The state of Washington approved increasing the minimum wage to $13.50 by 2020.
- The restaurant industry has already been under pressure, with labor costs as a percentage of sales on the rise. Other pockets of retail will also feel a sting from the higher minimum wage boost.
- Restaurant stocks: CAKE, CBRL, DNKN, DPZ, DRI, EAT, JACK, MCD, RRGB, RT, SONC, WEN, BWLD, BDL, QSR, CHUY, BLMN, PZZA, TXRH, DENN, KKD, BBRG, DFRG, BOBE, RUTH, IRG, DIN, HABT, NDLS, BOJA, PBPB, PLKI, FRSH, RAVE, LOCO, TACO, PZZA, KONA, BGR, BJRI, CHUY, FRS, CBRL, GTIM, TAST, WING, BOJA, ZOES, FOGO, ARCO, SHAK, YUM.
- Retail stocks: TGT, WMT, BIG, FIVE, DG, DLTR.
- Related ETF: BITE.
Wed, Oct. 26, 9:38 AM
- CLSA turns around on Dollar General (DG +0.2%) with a timely two-notch upgrade to Outperform from Underperform.
- The running theory on the discounter is that it's sheltered from the Amazon Effect and is in the right pocket of retail.
- Shares of Dollar General trade almost 30% below their high from July after a disappointing Q2 earnings report. The company isn't due to spill numbers on Q3 until December 1.
Thu, Oct. 13, 10:31 AM
- KeyBanc has discounters on its mind.
- Five Below (FIVE -0.9%) earns an Overweight rating and price target of $47 from the investment firm.
- Dollar Tree (DLTR) also catches an Overweight initiation. "DLTR is a compelling multi-faceted story, supported by a strong execution at legacy DLTR, as well as a synergy and turnaround story at legacy FDO, acquired in 2015," writes analyst Bradley Thomas.
- Dollar General (DG -0.6%) is started at Sector Weight.
- YTD comparison: FIVE +19.9%, DG -4.4%, DLTR +0.3% vs. S&P Retail ETF -0.5%.
Sat, Oct. 8, 9:09 AM
- Retailers want the U.S. election over and quick. The negative tone has created a degree of uncertainty with consumers that has impacted spending and traffic patterns, according to a host of top execs.
- "There is just great uncertainty as to what is going to happen in the U.S. in particular as a result of the outcome of the election," noted Yum Brands (NYSE:YUM) CEO Greg Creed recently. "People may be hunkering down a little bit," he added.
- Expect the topic to be raised on a large number of Q3 earnings calls over the next month to explain away revenue misses.
- It's not an excuse that everyone is buying into. Retail Metrics president Ken Perkins doubts that daily shopping needs are cut short by election fascination and notes consumer confidence is measuring high. Then there's Amazon (NASDAQ:AMZN) which seems to be rolling right along without any Clinton-Trump fatigue.
- Beyond the election wildcard, two underestimated factors impacting some retailers in a more concrete way are the lower level of SNAP (food stamps) benefits being paid out by the government and the elevated cost of health care. There is also the massive challenge with a millennial generation that shuns chains. Just ask anyone in the restaurant sector (NASDAQ:BITE).
- Add it all up and it makes for a challenging period for a mix of retailers that includes Dollar General (NYSE:DG), Dollar Tree (NASDAQ:DLTR), Fred's (NASDAQ:FRED), Ross Stores (NASDAQ:ROST), Wal-Mart (NYSE:WMT), Target (NYSE:TGT), Staples (NASDAQ:SPLS), McDonald's (NYSE:MCD), Popeyes Louisiana Kitchen (NASDAQ:PLKI), Wendy's (NYSE:WEN), Supervalu (NYSE:SVU), Kroger (NYSE:KR), SIgnet (NYSE:SIG), TJX Companies (NYSE:TJX), and Casey's General Stores (NASDAQ:CASY).
- Retail ETFs: XLY, XRT, VCR, RTH, RETL, IYK, FXD, IYC, FDIS, SCC, RCD, UCC, PMR, UGE, SZK, CNDF, FTXD, JHMC.
Thu, Oct. 6, 3:08 PM
- There's an interesting move higher in Dollar General (DG +2.8%) and Dollar Tree (DLTR +4%) today that could have its roots in the Wal-Mart investor meeting going on in Arkansas.
- The retail giant disclosed a subdued plan to add stores in the U.S. as part of its major commitment to growing out its e-commerce business.
- Investors could be taking that as a sign that Wal-Mart is ceding some ground to the discounters.
- Previously: Wal-Mart execs in the spotlight at investment meeting (Oct. 6)
- Previously: E-commerce the star at Wal-Mart investor meeting (Oct. 6)
Tue, Oct. 4, 10:11 AM
- Cleveland Research downgrades Dollar Tree (DLTR -3.2%) to a Neutral rating from Buy after channel checks indicate a slowdown in sales trends.
- Headwinds in the discounter space include increased competition, price deflation in key categories, and a reduction in SNAP benefits.
- The investment firm's dour outlook on the sector is hitting Dollar General (DG -1.5%) and Fred's (FRED -2.2%) as well.