Dollar General shares fall on first quarter revenue miss

The institution reported diluted net per stock of $2.00, supra Wall Street estimates of astir $1.89 to $1.90. Revenue roseate 3.4% year-over-year to $10.79 billion, conscionable beneath the $10.82 cardinal statement estimate. Same-store income accrued 2.0%, successful enactment with expectations.

Dollar General raised its fiscal 2026 adjusted net guidance to a scope of $7.20 to $7.45 per share, up from $7.10 to $7.35 previously. The institution noted the updated outlook reflects the first-quarter show arsenic good arsenic a little assumed taxation complaint of astir 24.5%.

The retailer maintained its full-year nett income maturation forecast of 3.7% to 4.2% and same-store income maturation outlook of 2.2% to 2.7%. Capital expenditures are expected to scope betwixt $1.4 cardinal and $1.5 billion.

Dollar General besides declared a quarterly dividend of $0.59 per share.

“We are pleased with our first-quarter EPS performance, which exceeded our expectations arsenic beardown operating borderline enlargement much than offset the interaction of terrible wintertime upwind and higher substance costs,” Dollar General CEO Todd Vasos said successful a statement.

“Our topline results were highlighted by affirmative lawsuit postulation and balanced class growth, portion continued advancement connected our cardinal initiatives drove different 4th of beardown operating nett growth.”

Jefferies analysts described Dollar General’s 4th arsenic a prime Q1 bushed and reiterated a ‘Buy’ rating, citing traffic-driven show and continued borderline improvement.

The steadfast wrote that the results were underpinned by comps led by lawsuit postulation and beardown gross borderline enlargement of 65 ground points, which it said reinforces the ongoing self-help narrative.

The analysts highlighted that comparable income maturation of 2.0% was driven much by postulation (+1.4%) than by summons (+0.5%), a premix they presumption arsenic supportive for worth retailers successful the existent environment. They besides noted that maturation was broad-based crossed categories, reinforcing their presumption that Dollar General is continuing to summation share.

On profitability, Jefferies pointed to 10.8% operating nett maturation and 12.4% EPS growth, attributing the betterment to inventory markups alongside gains successful shrink and damages, partially offset by markdown unit and higher proscription costs. The steadfast said the results bespeak improving execution and stronger operational discipline.