Family Dollar (FDO) did not disappoint Wall Street. For the second quarter, the discount chain said it made 81 cents per share against 60 cents per share in the second quarter of 2009. That was good for a 35% growth rate.

Even better, though, was the fact that management was able to beat the estimates. Analysts were looking for 78 cents per share on the bottom line. The gross margin rose from 33.7% to 35.4%. Same-store sales expanded by 3.6%.

Continue reading Family Dollar Rises After Q2 Numbers

Family Dollar Rises After Q2 Numbers originally appeared on BloggingStocks on Wed, 07 Apr 2010 15:15:00 EST. Please see our terms for use of feeds.

Family Dollar Stores (FDO), a discount chain whose colleagues include Dollar Tree (DLTR) and Wal-Mart (WMT), is set to report second-quarter earnings on Wednesday. The question is, should a trader open a position before the numbers?

This is a really difficult one. According to Trey Thoelcke's data summary, analysts are expecting very good things from the retailer. Earnings may rise over 20% to 78 cents per share, while sales could increase just under 5%. Another positive element is the dividend payout: it was raised in January by 14.8%. You've got to take that as a sign of confidence on the part of the management team, right?

Continue reading Buy Family Dollar Before Q2 Report?

Buy Family Dollar Before Q2 Report? originally appeared on BloggingStocks on Tue, 06 Apr 2010 14:40:00 EST. Please see our terms for use of feeds.

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

Family Dollar Up Big on Q1 report originally appeared on BloggingStocks on Wed, 06 Jan 2010 16:45:00 EST. Please see our terms for use of feeds.

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

Family Dollar beats in Q4, but sales weren't exciting originally appeared on BloggingStocks on Thu, 08 Oct 2009 08:30:00 EST. Please see our terms for use of feeds.

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?

Dollar Tree has an incredible quarter -- too late to buy? originally appeared on BloggingStocks on Thu, 27 Aug 2009 08:30:00 EST. Please see our terms for use of feeds.

Continue reading Family Dollar (FDO) jumps on strong earnings

Family Dollar (FDO) jumps on strong earnings originally appeared on BloggingStocks on Wed, 08 Apr 2009 14:45:00 EST. Please see our terms for use of feeds.

Continue reading Family Dollar (FDO) Q2 earnings preview

Family Dollar (FDO) Q2 earnings preview originally appeared on BloggingStocks on Tue, 07 Apr 2009 15:30:00 EST. Please see our terms for use of feeds.

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

Earnings preview: Shareholders are bracing for J. Crew's Q4 report originally appeared on BloggingStocks on Mon, 09 Mar 2009 17:00:00 EST. Please see our terms for use of feeds.

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.

Can you still buy Family Dollar Stores? originally appeared on BloggingStocks on Wed, 07 Jan 2009 16:00:00 EST. Please see our terms for use of feeds.

Family Dollar (FDO) earnings strong despite slowing economy originally appeared on BloggingStocks on Fri, 03 Oct 2008 12:49:00 EST. Please see our terms for use of feeds.

Family Dollar posts 7% increase in net income as shoppers flock there originally appeared on BloggingStocks on Mon, 07 Jul 2008 13:01:00 EST. Please see our terms for use of feeds.

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

Options update: Mosaic and Family Dollar volatility Up into EPS originally appeared on BloggingStocks on Fri, 04 Jan 2008 10:30:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• 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.

• B. Riley downgraded shares of Iris International Inc (NASDAQ: IRIS) to Neutral from Buy.
  
• Soleil downgraded ExpressJet Holdings Inc (NYSE: XJT) to sell from Hold.
  
• Calyon downgraded Weatherford International (NYSE: WFT), Transocean Inc (NYSE: RIG) and Diamond Offshore Drilling Inc (NYSE: DO) to Add from Buy.

Analyst downgrades: NDAQ, FDO, CC, WFC and KEY originally appeared on BloggingStocks on Fri, 21 Sep 2007 10:45:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• 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)...

• 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.

• Matrix downgraded Talisman Energy (NYSE: TLM) to Hold from Buy.

Analyst downgrade: DRL, EL, ETFC and FDO originally appeared on BloggingStocks on Wed, 22 Aug 2007 10:40:00 EST. Please see our terms for use of feeds.

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?

Are dollar stores a good investment here? originally appeared on BloggingStocks on Mon, 13 Aug 2007 19:00:00 EST. Please see our terms for use of feeds.

Family Dollar (NYSE: FDO) has settled shareholder lawsuits relating to the backdating of stock options issued to executives at the company. Under the terms of the settlement, Chairman and Chief Executive Howard Levine, President and Chief Operating Officer R. James Kelly, board member George Mahoney and executive C. Martin Sowers will give up a total of 210,000 stock options.

The company will also institute corporate governance reforms including the adoption of a majority-vote policy for uncontested elections of directors and the election of two additional independent directors.

Here's what bothers me: The company will be taking a charge of $5.7 million related to the settlement, including $3.5 million to cover the attorney's fees of the shareholders who brought the lawsuits.

This is my question: Given that the company clearly had ineffective internal controls that allowed top executives to receive backdated stock options, why should the company's shareholders have to pick up the tab for the legal fees? CEO Howard Levine made more than $3.1 million last year. Since he and other executives and directors were the ones responsible for options backdating, why shouldn't they pay legal fees?

Family Dollar to take $5.7 million charge related to shareholder lawsuits -- That'll show em'! originally appeared on BloggingStocks on Mon, 25 Jun 2007 09:56:00 EST. Please see our terms for use of feeds.

Continue reading Target loses sourcing executive to Family Dollar

Target loses sourcing executive to Family Dollar originally appeared on BloggingStocks on Thu, 05 Apr 2007 15:05:00 EST. Please see our terms for use of feeds.

I thought it might be interesting to present a comparison between the two best known dollar store operations. Both Family Dollar (NYSE:FDO) and Dollar General (NYSE:DG) are well known for their penny pinching product packed stores but in a financial sense how are these two discount chains faring within the far flung retail world and how do they compare to one another? With reckless abandon I have chosen to dive deep into the darkest reaches of the Internet to draw some insight on the dollar store world.

Dollar General, a Fortune 500 discount retailer, has been in operation since 1955 and currently operates 8,309 stores. The Dollar General website predicates the company's mission upon the statement, "Dollar General stores offer convenience and value to customers, by offering consumable basic items that are frequently used and replenished, such as food, snacks, health and beauty aids and cleaning supplies, as well as a selection of basic apparel, housewares and seasonal items at everyday low prices."

Family Dollar began operations in 1958 and is a part of the Fortune 500 Index. Currently, Family Dollar operates over 6,200 stores which are especially located to serve Family Dollar's middle to lower income target clientele. Their mission statement as presented on the Family Dollar website is a three part declaration of value: "For our customers, a compelling place to shop . . . by providing convenience and low prices. For our associates, a compelling place to work . . . by providing exceptional opportunities and rewards for achievement. For our investors, a compelling place to invest . . . by providing outstanding returns."

Both of these dollar store operations appear to make it clear that it is their intent to offer discounted retail merchandise in first class fashion. Both companies have a drive and focus which place the average American at the heart of their mission and both companies also seek to present their investors with consistently healthy returns. And the more I read about these two compact discount retailers, the more I get the message that they are far less concerned about competing with each other than they are about trimming the edges off of their mutual competitor Wal-Mart (NYSE:WMT).

Continue reading DG and FDO: The battle of the dollar stores

DG and FDO: The battle of the dollar stores originally appeared on BloggingStocks on Wed, 28 Feb 2007 12:19:00 EST. Please see our terms for use of feeds.

Is America one big boring cliche after another? To many foreigners it is, since most of our shopping -- a very big reason for tourism anywhere -- is done at cookie-cutter chain stores. Whether it be home furnishings, consumer electronics, food or baby clothes, there is a chain store (and many different ones at that) dedicated to feeding the commerce need we have for every possible segment of living. Capitalism at its best, you might say. Or, its worst, if you're into the "experience" of shopping rather than the "task" of shopping.

For the most part, done are the days of the "mom and pop" store. The chains are everywhere, ready to sell, serve and provide anything they possibly can while collecting as much information about you as they can. Now, I'm not necessarily against chain stores; as the biggest force in the world's largest economy (at least two-thirds of it) runs from the same consumers who keep these chain stores humming night and day.

Chains like the following list are present in almost every large American city (get ready...deep breath) Bed Bath & Beyond; Linens-n-Things; Barnes & Noble and Borders; PetSmart and Petco; Circuit City and Best Buy; Lowe's and Home Depot; CVS and Walgreens; Wal-Mart, Target and Costco; Dollar General, Family Dollar and Dollar Tree. Need more? How about the Apple Store and Pottery Barn, the Gap and Ann Taylor, Banana Republic and DSW, Starbucks and McDonald's. Now that's a lot of chain stores. What would we do without all these chain stores? Probably we'd all pay higher prices while actually enjoying the shopping experience again. We might even form social attachments to our local merchants again. But, the American consumers' motto continues to be "price, price, and -- well -- price."

That's why we have chain stores.

Should we be thankful for chain stores? originally appeared on BloggingStocks on Tue, 19 Dec 2006 14:55:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY: Verizon (VZ), Family Dollar (FDO) and Kroger (KR) top today's extensive list of downgrades.

• Verizon was downgraded to Sell from Hold at Citigroup. The firm sees greater earnings power along with a better valuation at AT&T (T), and they believe Verizon has risk to their estimates through 2008.
• Banc of America downgraded Family Dollar to Neutral from Buy. BofA cited the increasingly competitive environment for the downgrade.
• Banc of America also expects consumable pricing to come under pressure due to initiatives at Wal-Mart Stores, Inc. (NYSE:WMT), and downgraded Kroger (KR) to Sell from Neutral.

OTHER DOWNGRADES:

• Citigroup downgraded Mastercard (MA) to Sell from Hold. With Mastercard shares up over +50% the last two months, the firm recommends waiting for a 10% pullback before buying shares.
• UBS assumed coverage of Sprint-Nextel (S) and downgraded them to Neutral from Buy.
• And finally, Prudential downgraded PNC Bank (PNC) to Underweight from Neutral following the acquisition by Mercantile Bancshares (MRBK). The firm believes the acquisition negatively impacts estimates and destroys value.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).

Analyst downgrades 10-09-06: Downbeat on Verizon, Kroger originally appeared on BloggingStocks on Mon, 09 Oct 2006 10:59:00 EST. Please see our terms for use of feeds.