Continue reading Family Dollar's Earnings Increase 19%, Outlook Soft

Family Dollar's Earnings Increase 19%, Outlook Soft originally appeared on BloggingStocks on Wed, 07 Jul 2010 09:30:00 EST. Please see our terms for use of feeds.

On Tuesday, discount retailer Target (NYSE: TGT) announced that it is going to do its best to stimulate the job market. The company announced that it will open 26 new stores, which will lead to 5,000 new jobs. These stores are set to open on October 11, and a majority of the stores will be of the general merchandise variety, with five of them full-grocery SuperTarget stores.

Target is making this move as the company is facing a tough market. A week ago, UBS cut the stock from "neutral" to "buy," citing a "tarnished image" for the retailer. Target saw quarterly profit fall for an eighth straight quarter after reporting a second-quarter drop. In addition, Target saw same-store sales fall 6.2%.

Continue reading Target opening new stores, creating new jobs

Target opening new stores, creating new jobs originally appeared on BloggingStocks on Wed, 07 Oct 2009 11:00:00 EST. Please see our terms for use of feeds.

Continue reading Target downgraded by UBS

Target downgraded by UBS originally appeared on BloggingStocks on Wed, 30 Sep 2009 10:20:00 EST. Please see our terms for use of feeds.

The third quarter was a record quarter for discount retailer Family Dollar (NYSE: FDO). The company reported this morning that net income for the third quarter increased 34.8%, coming in at 62 cents per diluted share.

A year ago, FDO earned 46 cents per diluted share. Net income increased 35.5% to $87.7 million, up from $64.7 million a year ago. Not only were the results better than those from a year ago, but the retailer also topped the consensus estimate of 59 cents per share. Looking ahead, FDO expects to earn between 39 and 43 cents per share in the fourth quarter, compared to expectations of 39 cents per share.

Is it a surprise that this retailer had such a strong quarter? Yes and no. Yes, in term of what the experts on Wall Street believed we would see. No, because FDO is a discount retailer and we are in the midst of one heck of an economic downturn.

Continue reading Family Dollar reports impressive third-quarter earnings results

Family Dollar reports impressive third-quarter earnings results originally appeared on BloggingStocks on Wed, 08 Jul 2009 08:05:00 EST. Please see our terms for use of feeds.

This post is part of a series featuring bargain stocks that are worth a look now. See more Cheap Stocks.

In troubled economic times, it seems like a no-brainer that discount retailers will fare better than their mid-market competitors. Of the discount group, Costco Wholesale (NASDAQ: COST) garners extra points for its brand recognition, broad geographic reach, and dedication to its customers.

Speaking of customer service, I recall being mildly shocked earlier this year upon reading this BusinessWeek article, which alleges that Costco often chooses to cater to its customer base rather than pleasing its investors. Amid skyrocketing commodity costs in July, the mega-retailer warned of a quarterly earnings shortfall, because of a reluctance to hike its own prices and potentially alienate its customer base.

I'm no CEO, but to my mind, the happiness of Costco's investors is directly pegged to how satisfied its customers are. If shoppers are turned off by price increases and take their business over to, say, Sam's Club -- what have the investors won? It takes a clear-headed management team to consider the long-term effects on its core customer base over the short-term demands of frustrated traders.

Continue reading Cheap Stocks: Costco Wholesale

Cheap Stocks: Costco Wholesale originally appeared on BloggingStocks on Sun, 07 Dec 2008 15:10:00 EST. Please see our terms for use of feeds.

Discount retailer Dollar Tree Inc. (NASDAQ: DLTR) surprised the Street this morning with a stronger-than-expected third-quarter profit. The cut-rate retailer raked in earnings of $43.1 million, or 47 cents per share, an improvement of 23.7% over the same period last year. Analysts were expecting a more modest per-share profit of 44 cents. Revenue for the quarter rose by roughly 12% to $1.11 billion, with same-store sales increasing 6.2%.

As long as consumers maintain a death grip on their discretionary spending, Dollar Tree seems poised to benefit. Shoppers appear to be migrating away from mid-market retailers and toward discount chains, such as DLTR and Family Dollar (NYSE: FDO). President and CEO Bob Sasser stated, "We will continue to focus on the customer, and serving their needs in a very difficult economic environment."

Going forward, Dollar Tree expects that its focus on the ailing consumer will support solid earnings growth. The company once again raised its fiscal-year earnings forecast; it now expects an annual profit of $2.45 to $2.53 per share.

Continue reading Dollar Tree's profits soar 20% as consumers 'trade down'

Dollar Tree's profits soar 20% as consumers 'trade down' originally appeared on BloggingStocks on Tue, 25 Nov 2008 10:25:00 EST. Please see our terms for use of feeds.

3Q 2007 operating income grew 10X operating income from 3Q 2006, to $22.7 million from $2.3 million. CEO Steve Fishman credits the vast improvement in operating profit to a much more efficient product distribution system and higher gross margin dollars per square foot.

Continue reading Big Lots (BIG) reports big third quarter

Big Lots (BIG) reports big third quarter originally appeared on BloggingStocks on Tue, 04 Dec 2007 16:10:00 EST. Please see our terms for use of feeds.

Discount retailer Big Lots Inc. (NYSE: BIG) reported good 2Q 2007 earnings, driven in large measure by dramatic improvements in inventory control and distribution. Big Lots has gotten better at getting merchandise into stores on time and then moving it out the door faster. Big Lots reduced cost of inventory 13% to $714 million, still a hefty amount. But Big Lots has also increased its inventory turnover rate, which resulted in a 5% increase in same-store sales. Lots of retailers would like to post such an increase for just one quarter. Big Lots has posted 5% or better increases in same-store sales for the last two quarters.

Big Lots' strategy to concentrate on its supply chain management is beginning to pay off handsomely. Net sales increased 2.7% to $1,084.9 million or diluted EPS of $0.21, 5 times the amount of 2Q 2006. Operating profit also increased 3% to $33.4 million even though Big Lots is selling lower-margin merchandise. In addition to distribution system enhancements, Big Lots also kept the lid of insurance-related costs and cut back on advertising spending.

There are many discount retailers for investors to choose from. Big Lots is more attractive than most because the company carries NO long-term debt obligations, and presently has cash and cash equivalents of $109 million on hand. The company spent $215 million of the $600 million authorized on stock repurchases in 2Q, and will continue its buyback in the following quarters.

Given the good numbers from the previous two quarters, and 3Q and 4Q predicted comparable-store sales increases of 1%-3% per quarter, Big Lots management increased FY 2007 guidance EPS to $1.43-$1.48. Cash flow is expected to increase to $240 million, and inventory turnover rate will continue to climb. Big Lots wants to sell more merchandise more quickly. Lucky investors in the stock were up 9% on Wednesday as a result of the earnings release. The stock closed on August 29 at $28.91, up $2.61.

Big Lots (BIG) posts big earnings originally appeared on BloggingStocks on Thu, 30 Aug 2007 08:15:00 EST. Please see our terms for use of feeds.