{"id":55389,"date":"2023-08-31T15:30:03","date_gmt":"2023-08-31T19:30:03","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/dollar-generals-stock-tumbles-after-retailer-misses-earnings-estimates-and-lowers-guidance\/"},"modified":"2023-08-31T15:30:06","modified_gmt":"2023-08-31T19:30:06","slug":"dollar-generals-stock-tumbles-after-retailer-misses-earnings-estimates-and-lowers-guidance","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=55389","title":{"rendered":"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance"},"content":{"rendered":"

Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its guidance. <\/p>\n

The stock was on track for its lowest close since June 4, 2019, according to Dow Jones Market Data. <\/p>\n

\n

\u201cWhile we are not satisfied with our overall financial results, we made significant progress in the second quarter improving execution in our supply chain and our stores, as well as reducing our inventory growth rate and further strengthening our price position,\u201d Jeff Owen, Dollar General\u2019s chief executive officer, said in a statement. <\/p>\n

On a call with analysts, Owen said consumers are still showing signs of careful spending and prioritizing needs over wants. The company made targeted price reductions on certain key items to provide more affordable solutions, he said, according to a FactSet transcript.<\/p>\n

\u201cWe have been pleased with the customer response both in terms of basket size and composition when the basket includes one of these items,\u201d he said. <\/p>\n

The Goodlettsville, Tenn.-based company
\n DG,
\n -12.02%<\/bg-quote>
\n had net income of $468.8 million, or $2.13 a share, for the quarter, down from $678 million, or $2.98 a share, in the year-earlier period. Sales rose to $9.796 billion from $9.426 billion. <\/p>\n

The FactSet consensus was for earnings per share of $2.47 and sales of $9.926 billion. <\/p>\n

Same-store sales fell 0.1%, while FactSet was expecting a 0.9% rise. <\/p>\n

The sales increase was mostly due to positive contributions from new stores, which were partially offset by a decline in same-store sales and by store closures. Same-store sales were hurt by lower traffic, partly offset by higher average transaction amount. <\/p>\n

Owen said the company is making further investments to draw down inventory and drive growth in areas such as retail labor, and it expects an operating profit headwind of up to $170 million in the second half from those investments. <\/p>\n

\u201cSame-store sales in the second quarter of 2023 included declines in each of the home, seasonal, and apparel categories, partially offset by growth in the consumables category,\u201d the statement said.<\/p>\n

Gross profit as a percentage of sales was 31.4%, down from 32.3% a year ago, for a decline of 126 basis points. That was mostly due to lower inventory markups and increased shrink, markdowns and inventory damages, as well as to a greater proportion of sales coming from the consumables category, which has a lower gross profit rate than other product categories. <\/p>\n

Many retailers this earnings season have complained about the impact of shrink, which can refer to damaged goods but more often means shoplifting, which retailers claim is being conducted by organized gangs. <\/p>\n

Walmart
\n WMT,
\n +0.91%<\/bg-quote>,<\/span>
\n Target
\n TGT,
\n -0.27%<\/bg-quote>,<\/span>
\n Home Depot
\n HD,
\n -0.01%<\/bg-quote>,<\/span>
\n Nordstrom
\n JWN,
\n +3.31%<\/bg-quote>
\n and Dollar General\u2019s key rival Dollar Tree
\n DLTR,
\n -1.55%<\/bg-quote>
\n have all complained this earnings season about the issue. Dollar General said it\u2019s now expecting shrink to create a roughly $100 million headwind over the rest of the year.<\/p>\n

\u201cWhile we expect this pressure to continue for the remainder of the year and recognize this is a challenge throughout retail, we are actively working to reduce these levels through multiple targeted actions,\u201d said Chief Financial Officer Kelly Dilts. \u201cThese include reducing our inventory position, refreshing and refining our processes, leveraging additional tools and technology, and improving execution in our stores.\u201d<\/p>\n

See:<\/strong>\u00a0Walmart\u2019s \u2018shrink\u2019 challenges differ from those of other retail giants, CEO says<\/p>\n

Related:<\/strong>\u00a0Target facing \u2018unacceptable amount\u2019 of retail theft and organized retail crime, CEO says<\/p>\n

Dollar General lowered its guidance and said it now expects sales to be up 1.3% to 3.3%, compared with prior guidance of up 3.5% to 5%. It expects EPS of about $7.10 to $8.30, or a decline of 34% to 22%, compared with prior guidance for a decline of about 8% to flat growth. <\/p>\n

It said it expects same-store sales to be down about 1% to up about 1%, compared with prior guidance of growth of 1% to 2%. <\/p>\n

Jefferies analyst Corey Tarlowe said the results were soft.<\/p>\n

\u201cLooking ahead, we believe\u00a0[Dollar General] is faced with industry-wide headwinds and incremental investments, but stays well-positioned due to its high mix of consumables, private label expansion, and organic growth opportunities,\u201d he wrote in a note to clients.<\/p>\n

Jefferies has a buy rating on the stock and a $230 price target, which is 46% above its current price. <\/p>\n

BMO analyst Kelly Bania said the cut in EPS guidance was significant and that negative traffic suggested a meaningful gap to key peer Dollar Tree, which saw traffic up in the high single digits in the quarter. Bania has a market-perform rating on the stock and a $175 price target, which is 33% above its current price.<\/p>\n

The stock has fallen 45% in the year to date, while the S&P 500
\n SPX
\n has gained 17.6%. <\/p>\n

For more, read:<\/strong>\u00a0As concerns mount about organized retail crime, these are the products being targeted<\/p>\n<\/p><\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its guidance. The stock was on track for its lowest close since June 4, 2019, according to Dow Jones Market Data. \u201cWhile we are not satisfied with our overall financial results, we made significant progress in the second […]<\/p>\n","protected":false},"author":1,"featured_media":55390,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-55389","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nDollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=55389\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance | iFintechWorld\" \/>\n<meta property=\"og:description\" content=\"Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its\" \/>\n<meta property=\"og:url\" content=\"https:\/\/ifintechworld.com\/?p=55389\" \/>\n<meta property=\"og:site_name\" content=\"iFintechWorld\" \/>\n<meta property=\"article:published_time\" content=\"2023-08-31T19:30:03+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-08-31T19:30:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/08\/1693510204_social.jpeg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"640\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"News Room\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"News Room\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/ifintechworld.com\/?p=55389#article\",\"isPartOf\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=55389\"},\"author\":{\"name\":\"News Room\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61\"},\"headline\":\"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance\",\"datePublished\":\"2023-08-31T19:30:03+00:00\",\"dateModified\":\"2023-08-31T19:30:06+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=55389\"},\"wordCount\":788,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/ifintechworld.com\/#organization\"},\"keywords\":[\"Featured\"],\"articleSection\":[\"Investing\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/ifintechworld.com\/?p=55389#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/ifintechworld.com\/?p=55389\",\"url\":\"https:\/\/ifintechworld.com\/?p=55389\",\"name\":\"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance | iFintechWorld\",\"isPartOf\":{\"@id\":\"https:\/\/ifintechworld.com\/#website\"},\"datePublished\":\"2023-08-31T19:30:03+00:00\",\"dateModified\":\"2023-08-31T19:30:06+00:00\",\"description\":\"Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its\",\"breadcrumb\":{\"@id\":\"https:\/\/ifintechworld.com\/?p=55389#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/ifintechworld.com\/?p=55389\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/ifintechworld.com\/?p=55389#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/ifintechworld.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/ifintechworld.com\/#website\",\"url\":\"https:\/\/ifintechworld.com\/\",\"name\":\"Repay Down\",\"description\":\"Latest Personal Finance News, Tips and Updates\",\"publisher\":{\"@id\":\"https:\/\/ifintechworld.com\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/ifintechworld.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/ifintechworld.com\/#organization\",\"name\":\"Repay Down\",\"url\":\"https:\/\/ifintechworld.com\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png\",\"contentUrl\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png\",\"width\":558,\"height\":90,\"caption\":\"Repay Down\"},\"image\":{\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/\"}},{\"@type\":\"Person\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61\",\"name\":\"News Room\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ifintechworld.com\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png\",\"contentUrl\":\"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png\",\"caption\":\"News Room\"},\"sameAs\":[\"https:\/\/ifintechworld.com\"],\"url\":\"https:\/\/ifintechworld.com\/?author=1\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance | iFintechWorld","description":"Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/ifintechworld.com\/?p=55389","og_locale":"en_US","og_type":"article","og_title":"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance | iFintechWorld","og_description":"Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its","og_url":"https:\/\/ifintechworld.com\/?p=55389","og_site_name":"iFintechWorld","article_published_time":"2023-08-31T19:30:03+00:00","article_modified_time":"2023-08-31T19:30:06+00:00","og_image":[{"width":1280,"height":640,"url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/08\/1693510204_social.jpeg","type":"image\/jpeg"}],"author":"News Room","twitter_card":"summary_large_image","twitter_misc":{"Written by":"News Room","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/ifintechworld.com\/?p=55389#article","isPartOf":{"@id":"https:\/\/ifintechworld.com\/?p=55389"},"author":{"name":"News Room","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61"},"headline":"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance","datePublished":"2023-08-31T19:30:03+00:00","dateModified":"2023-08-31T19:30:06+00:00","mainEntityOfPage":{"@id":"https:\/\/ifintechworld.com\/?p=55389"},"wordCount":788,"commentCount":0,"publisher":{"@id":"https:\/\/ifintechworld.com\/#organization"},"keywords":["Featured"],"articleSection":["Investing"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/ifintechworld.com\/?p=55389#respond"]}]},{"@type":"WebPage","@id":"https:\/\/ifintechworld.com\/?p=55389","url":"https:\/\/ifintechworld.com\/?p=55389","name":"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance | iFintechWorld","isPartOf":{"@id":"https:\/\/ifintechworld.com\/#website"},"datePublished":"2023-08-31T19:30:03+00:00","dateModified":"2023-08-31T19:30:06+00:00","description":"Dollar General Corp.\u2019s stock tumbled 15% Thursday after the discount retailer posted weaker-than-expected second-quarter earnings and lowered its","breadcrumb":{"@id":"https:\/\/ifintechworld.com\/?p=55389#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/ifintechworld.com\/?p=55389"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/ifintechworld.com\/?p=55389#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/ifintechworld.com\/"},{"@type":"ListItem","position":2,"name":"Dollar General\u2019s stock tumbles after retailer misses earnings estimates and lowers guidance"}]},{"@type":"WebSite","@id":"https:\/\/ifintechworld.com\/#website","url":"https:\/\/ifintechworld.com\/","name":"Repay Down","description":"Latest Personal Finance News, Tips and Updates","publisher":{"@id":"https:\/\/ifintechworld.com\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/ifintechworld.com\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/ifintechworld.com\/#organization","name":"Repay Down","url":"https:\/\/ifintechworld.com\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/","url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png","contentUrl":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/rep-logo-dark.png","width":558,"height":90,"caption":"Repay Down"},"image":{"@id":"https:\/\/ifintechworld.com\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/6224724fd4116361255b179dc5c70b61","name":"News Room","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/ifintechworld.com\/#\/schema\/person\/image\/","url":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png","contentUrl":"https:\/\/ifintechworld.com\/wp-content\/uploads\/2023\/04\/avatar_user_1_1682606986-96x96.png","caption":"News Room"},"sameAs":["https:\/\/ifintechworld.com"],"url":"https:\/\/ifintechworld.com\/?author=1"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/55389","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=55389"}],"version-history":[{"count":1,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/55389\/revisions"}],"predecessor-version":[{"id":55391,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/posts\/55389\/revisions\/55391"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=\/wp\/v2\/media\/55390"}],"wp:attachment":[{"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=55389"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=55389"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ifintechworld.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=55389"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}