Dollar General Shares Zip Higher After Retailer Raises Outlook
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Dollar General raised its outlook for the year after assessing the impact of tariffs on its business and consumer behavior and its better-than-expected first-quarter results, sending its shares 11% higher in premarket trading.
The discount retailer said it expects sales to rise 3.7% to 4.7% for the fiscal year ending Jan. 30, and 1.5% to 2.5% on a same-store comparable basis. Earnings are expected to hit $5.20 to $5.80 a share.
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The company said its updated guidance assumes current tariff rates remain in place through mid-August, while noting it has plans to address their potential reversion to higher rates announced in early April.
Dollar General previously forecast sales to increase 3.4% to 4.4%, same-store sales growth between 1.2% and 2.2% and earnings per-share in the range of $5.10 to $5.80.
“We are uniquely well-positioned to serve our customer in a variety of economic environments,” said Chief Executive Todd Vasos.
For the first quarter that ended May 2, Dollar General recorded net income of $391.9 million, or $1.78 a share, up from $363.3 million, or $1.65 a share, in the prior-year period. Analysts polled by FactSet expected $1.49 a share.
Sales rose to $10.44 billion from $9.91 billion. Analysts polled by FactSet expected $10.29 billion.
Same-store sales increased 2.4% from a jump in average transaction size that offset a drop in customer traffic. Analysts polled by FactSet expected 1.5% growth.
Write to Denny Jacob at denny.jacob@wsj.com