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Dollar General (DG) Q2 Earnings Coming Up: What's in the Cards?
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Dollar General Corporation (DG - Free Report) is likely to register an increase in the top line when it reports second-quarter fiscal 2023 results on Aug 31 before the opening bell. The Zacks Consensus Estimate for revenues is pegged at $9,939 million, indicating an improvement of 5.4% from the prior-year quarter’s level.
The bottom line of this discount retailer is expected to have decreased from the year-ago quarter’s reported figure. Over the past 30 days, the Zacks Consensus Estimate for second-quarter earnings per share has fallen by a penny to $2.49, suggesting a decline of 16.4% from the year-ago quarter.
Dollar General has a trailing four-quarter negative earnings surprise of 2%, on average. In the last reported quarter, this Goodlettsville, TN-based player beat the Zacks Consensus Estimate by 1.7%.
Key Factors to Note
Dollar General’s better pricing, private-label offerings and effective inventory management are likely to have contributed to the to-be-reported quarter’s top line. The company’s operational capabilities, coupled with its real estate growth strategy, position it well to gain market share by targeting low-to-middle-income-group consumers. It has also been focusing on consumable and non-consumable categories to boost traffic.
We also remain encouraged by the company’s host of initiatives, such as DG Fresh, Fast Track, digitization and private fleet. These are likely to have contributed to same-store sales. We expect second-quarter comparable sales to come in at 1%.
Dollar General Corporation Price, Consensus and EPS Surprise
While the aforementioned factors raise optimism about the outcome, the soft demand for discretionary products may have weighed on margins. Also, any deleverage in SG&A expenses, unless fully offset by sales, may have a direct bearing on margins. We foresee a 70-basis point deleverage in SG&A expenses, with an operating margin contraction of 210 basis points.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Dollar General this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, that’s not the case here.
Dollar General has a Zacks Rank #3 but an Earnings ESP of -0.44%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are three companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this season:
American Eagle Outfitters (AEO - Free Report) currently has an Earnings ESP of +8.52% and a Zacks Rank #2. The company is likely to register a bottom-line increase when it reports second-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of 15 cents suggests a sharp increase from 4 cents reported in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters’ top line is expected to decrease year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.19 billion, which indicates a marginal decline of 0.9% from the figure reported in the prior-year quarter. American Eagle Outfitters has a trailing four-quarter earnings surprise of 9.2%, on average.
Casey's General Stores (CASY - Free Report) currently has an Earnings ESP of +1.03% and carries a Zacks Rank #3. The company is likely to register a bottom-line decrease when it reports first-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $3.39 suggests a drop of 17.1% from the year-ago quarter.
Casey's General Stores’ top line is expected to decrease year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.85 billion, which indicates a drop of 13.5% from the figure reported in the prior-year quarter. CASY has a trailing four-quarter earnings surprise of 7.5%, on average.
Costco (COST - Free Report) currently has an Earnings ESP of +0.99% and a Zacks Rank of 3. The company is likely to register an increase in the bottom line when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $4.72 suggests a rise of 12.4% from the year-ago reported number.
Costco’s top line is expected to ascend year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $78.86 billion, which calls for an increase of 9.4% from the prior-year quarter. COST has a trailing four-quarter earnings surprise of 1.8%, on average.
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Dollar General (DG) Q2 Earnings Coming Up: What's in the Cards?
Dollar General Corporation (DG - Free Report) is likely to register an increase in the top line when it reports second-quarter fiscal 2023 results on Aug 31 before the opening bell. The Zacks Consensus Estimate for revenues is pegged at $9,939 million, indicating an improvement of 5.4% from the prior-year quarter’s level.
The bottom line of this discount retailer is expected to have decreased from the year-ago quarter’s reported figure. Over the past 30 days, the Zacks Consensus Estimate for second-quarter earnings per share has fallen by a penny to $2.49, suggesting a decline of 16.4% from the year-ago quarter.
Dollar General has a trailing four-quarter negative earnings surprise of 2%, on average. In the last reported quarter, this Goodlettsville, TN-based player beat the Zacks Consensus Estimate by 1.7%.
Key Factors to Note
Dollar General’s better pricing, private-label offerings and effective inventory management are likely to have contributed to the to-be-reported quarter’s top line. The company’s operational capabilities, coupled with its real estate growth strategy, position it well to gain market share by targeting low-to-middle-income-group consumers. It has also been focusing on consumable and non-consumable categories to boost traffic.
We also remain encouraged by the company’s host of initiatives, such as DG Fresh, Fast Track, digitization and private fleet. These are likely to have contributed to same-store sales. We expect second-quarter comparable sales to come in at 1%.
Dollar General Corporation Price, Consensus and EPS Surprise
Dollar General Corporation price-consensus-eps-surprise-chart | Dollar General Corporation Quote
While the aforementioned factors raise optimism about the outcome, the soft demand for discretionary products may have weighed on margins. Also, any deleverage in SG&A expenses, unless fully offset by sales, may have a direct bearing on margins. We foresee a 70-basis point deleverage in SG&A expenses, with an operating margin contraction of 210 basis points.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Dollar General this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, that’s not the case here.
Dollar General has a Zacks Rank #3 but an Earnings ESP of -0.44%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are three companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this season:
American Eagle Outfitters (AEO - Free Report) currently has an Earnings ESP of +8.52% and a Zacks Rank #2. The company is likely to register a bottom-line increase when it reports second-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for the quarterly earnings per share of 15 cents suggests a sharp increase from 4 cents reported in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters’ top line is expected to decrease year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.19 billion, which indicates a marginal decline of 0.9% from the figure reported in the prior-year quarter. American Eagle Outfitters has a trailing four-quarter earnings surprise of 9.2%, on average.
Casey's General Stores (CASY - Free Report) currently has an Earnings ESP of +1.03% and carries a Zacks Rank #3. The company is likely to register a bottom-line decrease when it reports first-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $3.39 suggests a drop of 17.1% from the year-ago quarter.
Casey's General Stores’ top line is expected to decrease year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.85 billion, which indicates a drop of 13.5% from the figure reported in the prior-year quarter. CASY has a trailing four-quarter earnings surprise of 7.5%, on average.
Costco (COST - Free Report) currently has an Earnings ESP of +0.99% and a Zacks Rank of 3. The company is likely to register an increase in the bottom line when it reports fourth-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $4.72 suggests a rise of 12.4% from the year-ago reported number.
Costco’s top line is expected to ascend year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $78.86 billion, which calls for an increase of 9.4% from the prior-year quarter. COST has a trailing four-quarter earnings surprise of 1.8%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.