FamilyDollar posts
FeedPosted Jan 6th 2010 4:45PM by Steven Mallas (RSS feed)
Filed under: Earnings Reports, Wal-Mart (WMT), Target Corp. (TGT), Family Dollar Stores (FDO)
Family Dollar Stores (FDO) is a hot stock this afternoon. As of this writing, shares were up over 11% on monster volume. Investors loved the first-quarter numbers. I found them intriguing, too.
Sales increased almost 4%, with same-store sales registering a 2.4% expansion. Net income jumped over 16% to 49 cents per diluted share. According to our earnings preview, Family Dollar was supposed to do 47 cents. Gross margin improved; one of the driving factors for this improvement was a reduction in seasonal markdowns, something I find particularly encouraging, since avoiding markdowns should always be near the top of the list when it comes to advisable actions in retail operations. In addition, management reiterated its guidance for the full fiscal year. Taking everything in total, I think we can say that the retailer delivered a strong quarter, especially in the face of the tough holiday period.
Continue reading Family Dollar Up Big on Q1 report
Posted Oct 8th 2009 8:30AM by Steven Mallas (RSS feed)
Filed under: Earnings Reports, Wal-Mart (WMT), Target Corp. (TGT), Family Dollar Stores (FDO)
Family Dollar Stores (NYSE: FDO), like Dollar Tree (NASDAQ: DLTR), is benefiting from the soft economy. Consumers love paying low prices, so they flock to these retail business models like moths to a flame. And judging by Family Dollar's Q4 report, people are still having a great time saving money.
Net income increased over 13% to 43 cents per share, which was two pennies higher than Wall Street's forecasts, according to our earnings preview. Unfortunately, sales weren't so great. Total sales went up 2.6%, and same-store sales saw a mere 1% gain. I would have expected higher growth in the comps metric.
Continue reading Family Dollar beats in Q4, but sales weren't exciting
Posted Aug 27th 2009 8:30AM by Steven Mallas (RSS feed)
Filed under: Earnings Reports, Wal-Mart (WMT), Target Corp. (TGT), Family Dollar Stores (FDO)
Dollar Tree (NASDAQ: DLTR) reported a truly excellent quarter. The stats contained in the release are monumentally impressive. Dollar Tree increased sales almost 12% in Q2, a performance that essentially matched expectations. Per-share income soared 50% to 63 cents, beating estimates of 54 cents per share.
This is one of those situations where all the numbers point toward future growth. Margins increased, as did cash from operations (I enjoyed the fact that capital expenditures didn't go up too much). Same-store sales moved higher by 6.8%, and management's outlook for the rest of the fiscal year received a boost. And judging by the guidance, I'd say that Dollar Tree shares aren't overly expensive at the moment. Let's add a technical factor to go along with my opinion of the valuation: Dollar Tree closed Wednesday to the upside by well over 4% on the earnings news, not far at all from a 52-week high. The price action was accompanied by healthy volume.
Continue reading Dollar Tree has an incredible quarter -- too late to buy?
Posted Mar 9th 2009 5:00PM by Steven Mallas (RSS feed)
Filed under: Earnings Reports, Forecasts, Wal-Mart (WMT), Family Dollar Stores (FDO), Kohl's Corp (KSS), Urban Outfitters (URBN)

It is tough to be a retailer in this climate. It's especially tough to be a retailer like J. Crew Group, Inc. (NYSE: JCG). After all, if you're a Wal-Mart Stores, Inc. (NYSE: WMT) or a Family Dollar Stores (NYSE: FDO), at least you can entice consumers with your low prices, and at least you stock things that people need. Not so with J. Crew. It's a fashion retailer that you don't have to visit during the recession. Apparently, many people indeed haven't been visiting lately. That's why shareholders will most likely be nervous when fourth-quarter numbers are issued after the bell on Tuesday, March 10.
According to this source, J. Crew should report an earnings loss of $0.27 per share. How ugly! This compares to a profit of $0.41 per share in the year-ago period. I expect to hear the same stuff that we've been hearing from retailers such as Urban Outfitters (NASDAQ: URBN) and Kohl's (NYSE: KSS): things are tough, the rest of the year is going to be a huge challenge, we're doing everything we can to navigate the business through the treacherous times, etc. Such rhetoric probably won't be comforting to shareholders, especially considering that J. Crew's stock isn't too far from a 52-week low.
Continue reading Earnings preview: Shareholders are bracing for J. Crew's Q4 report
Posted Jan 7th 2009 4:00PM by Steven Mallas (RSS feed)
Filed under: Earnings Reports, Wal-Mart (WMT), Family Dollar Stores (FDO)
Family Dollar Stores (NYSE: FDO), a retailer that competes with Dollar Tree (NASDAQ: DLTR) and Wal-Mart Stores, Inc. (NYSE: WMT), reported earnings for the first quarter on Wednesday, and the market couldn't have been happier. As I was writing this, the stock was trading up over 13% on very nice volume. But, is 13 an unlucky number in this case? Would those buying in now be buying in too high?
Well, I can understand the euphoria surrounding the stock rise. To begin with, Q1 earnings beat estimates by two pennies. They came in at $0.42 per share, and that represented a double-digit growth rate for the bottom line of over 13% (there's that unlucky number again!). Top-line sales of approximately $1.8 billion essentially met expectations. When you think of Family Dollar's business and marketing model, you can understand why it's doing well. We're in one of the worst recessions ever, and people are looking for cheap prices on everything. I'm not the biggest fan of dollar-store businesses (for instance, I don't think I'd buy foodstuffs for a buck), but I do shop at them from time to time and can appreciate the allure. I think you can also understand why the stock is performing as well as it has been today: on top of the earnings beat, Family Dollar was the greatest S&P stock story of 2008 according to this source.
Here's the big question on everyone's mind: Is Family Dollar still a buy? If you're currently trading strength, I think you could buy this one after a pullback and then ride the stock to its 52-week high of over $32 per share. I see no reason why it won't make that level, especially if economic conditions continue to worsen (did I say if?). However, I certainly wouldn't be a buyer of today's rally. I think there's momentum behind this name, but I'll say this -- there are probably better bargains out there for any profit you might make from a trade on Family Dollar. So if you do make some bucks on it (pun intended), I'd probably take the profits and allocate them elsewhere. I'm just not sure that Family Dollar will be the best performer in '09 as well.
Disclosure: I don't own any company mentioned, but positions can change without notice.
Posted Oct 3rd 2008 12:49PM by Brent Archer (RSS feed)
Filed under: Major Movement, Earnings Reports, Good news, Industry, Family Dollar Stores (FDO), Options, Technical Analysis
Family Dollar (NYSE:
FDO -
option chain) shares are rising today after the company posted a
fourth-quarter profit of $53.2 million, or 38 cents per share, beating analysts' estimates of 34 cents per share. Discount stores have been
one of two industries that have posted gains in the past year, alongside the typically defensive household goods industry. Today's earnings reinforce the idea that these companies are strong bets in weak economic times. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on FDO.
FDO opened this morning at $25.35. So far today the stock has hit a low of $25.23 and a high of $26.05. As of 12:25, FDO is trading at $25.18, up $1.19 (4.9%). The chart for FDO looks neutral and
S&P gives FDO a 3 STARS (out of 5) hold ranking.
For a bullish hedged play on this stock, I would consider a January
bull-put credit spread below the $17.50 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in just three and a half months as long as FDO is above $17.50 at January expiration. Family Dollar would have to fall by more than 30% before we would start to lose money. Learn more about this type of trade
here.
FDO hasn't been below $17.50 since January and has shown support around $23.50 recently.
Brent Archer is an options analyst and writer at Investors Observer.
DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in FDO.Posted Jul 7th 2008 1:01PM by Brian White (RSS feed)
Filed under: Products and Services, Consumer Experience, Family Dollar Stores (FDO)
Family Dollar Stores, Inc. (NYSE:
FDO), along with the other
dollar stores, may begin to see many more non-traditional customers who are aching to save every penny in the face of increasing energy and food costs. The first strike at that concept was from Family Dollar, which reported a 7.1% increase in net income for its latest quarter.
While sales grew at Family Dollar, stores that target affluent or higher-income shoppers saw flat or negative growth. This all points to one thing: customers are seeking out bargains wherever they can to offset rising prices in other areas of their lives. This sounds like it should have happened last summer as the credit freeze was beginning, but with summer in full swing and gas prices at $4 a gallon levels, the reality of the dollar store is setting in for millions of Americans.
With the typical Family Dollar customer being the "mom who makes less than $30,000 per year," it's not hard to imagine all the dollar-type retailers starting to see increasing fortunes in the near future. Every worker in the U.S. who drives has easily seen their last performance increase fade away. In fact, many have actually experienced a large financial demotion due to high gas prices and food costs. It's hard to think of it that way for many, but that is what it is. Inflation and energy costs can wipe out that raise pretty fast, yes? With that in mind, you may want to venture into a dollar store soon. Most likely, you'll be pleased with the price levels you find on almost every product.
Posted Jan 4th 2008 10:30AM by Paul Foster (RSS feed)
Filed under: Options
Mosaic(NYSE:MOS) volatility Elevated as shares close at record high into EPS. MOS, a producer & marketer of concentrated phosphate and potash crop nutrients, will report Q2 EPS on January 9th. MOS closed at $97.71. MOS January option implied volatility of 69 is above its 26-week average of 53 according to Track Data, suggesting larger price risks.
Family Dollar(NYSE:FDO) volatility Up as shares at seven-year low into EPS. FDO, an operator of 6,400 stores, will report Q1 EPS on January 8th. FDO January option implied volatility of 57 is above its 26-week average of 40 according to Track Data, suggesting larger risk.
Options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
Posted Sep 21st 2007 10:45AM by Eric Buscemi (RSS feed)
Filed under: Analyst Reports, Analyst Upgrades and Downgrades, , Family Dollar Stores (FDO), Wells Fargo (WFC)
MOST NOTEWORTHY: Nasdaq Stock Market, Family Dollar, Circuit City, Wells Fargo and Key Corp were today's noteworthy downgrades:
- Credit Suisse downgraded Nasdaq Stock Market Inc (NASDAQ: NDAQ) to Market Perform from Outperform on valuation.
- JP Morgan expects Family Dollar Stores Inc (NYSE: FDO) to face macro pressures and increased competition from Wal-Mart Stores Inc (NYSE: WMT) and Dollar General.
- Bear downgraded shares of Circuit City Stores Inc (NYSE: CC) to Peer Perform from Outperform based on lack of visibility, execution issues, softer consumer environment, potential pricing disruptions, and product cycle concerns.
- Merrill downgraded shares of Wells Fargo and Company (NYSE: WFC) to Neutral from Buy to reflect higher credit losses and valuation and KeyCorp (NYSE: KEY) to Sell from Neutral to reflect the company's "weak" revenue growth.
OTHER DOWNGRADES:
Posted Aug 22nd 2007 10:40AM by Kevin Shult (RSS feed)
Filed under: Before the Bell, Analyst Reports, Analyst Upgrades and Downgrades, Bad News, Estee Lauder (EL), Family Dollar Stores (FDO), Stocks to Sell
MOST NOTEWORTHY: American Capital (ACAS), Doral Financial (DRL), E-Trade Financial (ETFC) and Family Dollar (FDO) were today's noteworthy downgrade:
- Jefferies downgraded shares of American Capital (NASDAQ: ACAS) to Hold from Buy citing the slowing M&A market and risk characteristics of the company.
- Soleil downgraded Doral Financial (NYSE: DRL) to Sell from Hold, on the belief that the recent reverse stock split will increase short-selling activity and discourage speculative buying.
- E-Trade Financial (NASDAQ: ETFC) was cut to Neutral from Buy at UBS, citing deteriorating trends in the credit/mortgage markets, lack of near-term catalysts; the firm does not see an M&A deal occurring near-term.
- Goldman downgraded Family Dollar (NYSE: FDO) to Neutral from Buy, citing weakness in the low-end consumer and increased pressure from Wal-Mart (WMT)...
OTHER DOWNGRADES:
- Wachovia downgraded Tween Brands (NYSE: TWB) to Market Perform from Outperform.
- Estee Lauder (NYSE: EL) was downgraded to Neutral from Outperform at Credit Suisse.
- Deutsche Bank cut Pearson (NYSE: PSO) to Hold from Buy.
Analyst summaries provided by
TheFlyOnTheWall.com (subscription required
Posted Aug 13th 2007 7:00PM by Zac Bissonnette (RSS feed)
Filed under: Stocks to Buy
With daily reports in the financial press about the collapse of subprime lending, and the precarious position that lower-income Americans are finding themselves in, there's one group of retailers that may be destined to profit: Dollar stores. As people have to scrimp and save more to cover their ballooning mortgage payments, they may look to these discounters for household staples.
In addition, these companies are messing with big box retailers like Wal-Mart Stores, Inc. (NYSE: WMT) with competitive pricing and a smaller, more user friendly store-format.
Demographic trends are also helpful. Incomes at the lower-end are growing slowly and, as the baby boomer population ages, budget constraints may make these discounters more attractive.
These companies also tend to have simple business models, high turnover, and fairly predictable cash flows. While the private equity bull market appears to have waned, attractively valued dollar stores may still be attractive to some firms. KKR recently acquired Dollar General for $7.3 billion.
If you think dollar-stores have a bright future, you have a few investment options.
Continue reading Are dollar stores a good investment here?
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