We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Dollar Tree (DLTR) Up 2.2% Since the Last Earnings Report?
Read MoreHide Full Article
It has been about a month since the last earnings report for Dollar Tree, Inc. (DLTR - Free Report) . Shares have added about 2.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Dollar Tree Posts Solid Q4 Earnings & Sales
Dollar Tree posted robust fourth-quarter fiscal 2016 results. The company’s quarterly earnings of $1.36 per share registered 40.2% year-over-year growth. Further, earnings exceeded the company’s guidance range of $1.24–$1.33 per share. Per sources, results were aided by reduced costs and increased consumer traffic.
Consolidated net sales jumped 5% to $5,635.3 million in the quarter. Comparable store sales (comps) for the quarter grew 1.2%, on a constant-currency basis, backed by improved customer count and average ticket. Barring the impact of Canadian currency adjustments, comps rose 1.3%. While Dollar Tree banner posted currency-neutral comps growth of 2.3%, comps at the Family Dollar banner inched up 0.2%.
The company’s quarterly gross profit increased 9.3% year over year to $1,807 million, on the back of improved gross profit at both Family Dollar and Dollar Tree segments. Gross margin expanded 130 basis points (bps) to 32.1%, owing to reduced merchandise and freight expenses.
Selling, general and administrative expenses decreased 30 bps to 21.7% of sales, primarily benefiting from lower payroll, legal and depreciation costs, partly offset by increased store hourly payroll, advertising, and repairs and maintenance costs.
Balance Sheet
Dollar Tree ended the quarter with cash and cash equivalents of $866.4 million, net merchandise inventories of $2,865.8 million, net long-term debt of $6,169.7 million and shareholders’ equity of $5,389.5 million.
Store Update
Dollar Tree opened 104 outlets, expanded or relocated 27 outlets, and shuttered 55 outlets during the quarter. Moreover, during the quarter, the company launched eight old Family Dollar outlets as Dollar Tree outlets as part of its re-banner efforts. In fiscal 2016, the company opened 584 new stores.
Looking Ahead
Management remains pleased with its fiscal 2016 performance, as it crossed $20 billion in sales, alongside generating record earnings. Further, the company is progressing quite well with Family Dollar’s integration. The company further revealed that it is well on track with its expansion efforts for both Dollar Tree and Family Dollar. The company intends to attract shoppers and enhance customer experience with its diverse reach and desired products. All said, management believes that the company is well placed in the broad retail space, to deliver long-term value to shareholders. Further, the company issued a fresh outlook for the first-quarter and fiscal 2017.
Management projects consolidated net sales for fiscal 2017 in the band of $21.94–$22.33 billion. The guidance stems from comps growth in the range of flat to low single-digit increase and 3.9% increase in square footage. Earnings per share are envisioned in the $4.20–$4.56 range for fiscal 2017, which will include an additional 53rd week. The impact on sales and earnings from the additional week is included in management’s outlook.
For the fiscal first quarter, consolidated sales are projected in the range of $5.26–$5.35 billion, driven by comps growth in the flat to low single-digit increase range for the combined entity. Earnings are anticipated in the range of $0.91–$0.98 per share, compared with adjusted earnings of $0.89 reported in the same year-ago period.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
At this time, Dollar Tree's stock has a great Growth Score of 'A', though it is lagging a lot on the momentum front with a 'D'. However, the stock was allocated a grade of 'A' on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'A'. If you aren't focused on one strategy, this score is the one you should be interested in.
Zacks' style scores indicate that the company's stock is suitable for value and growth investors.
Outlook
Eestimates have been broadly trending downward for the stock. The magnitude of these revisions also indicates a downward shift. Notably, the stock has a Zacks Rank #3 (Hold). We are looking for an inline return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Dollar Tree (DLTR) Up 2.2% Since the Last Earnings Report?
It has been about a month since the last earnings report for Dollar Tree, Inc. (DLTR - Free Report) . Shares have added about 2.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock’s next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Dollar Tree Posts Solid Q4 Earnings & Sales
Dollar Tree posted robust fourth-quarter fiscal 2016 results. The company’s quarterly earnings of $1.36 per share registered 40.2% year-over-year growth. Further, earnings exceeded the company’s guidance range of $1.24–$1.33 per share. Per sources, results were aided by reduced costs and increased consumer traffic.
Consolidated net sales jumped 5% to $5,635.3 million in the quarter. Comparable store sales (comps) for the quarter grew 1.2%, on a constant-currency basis, backed by improved customer count and average ticket. Barring the impact of Canadian currency adjustments, comps rose 1.3%. While Dollar Tree banner posted currency-neutral comps growth of 2.3%, comps at the Family Dollar banner inched up 0.2%.
The company’s quarterly gross profit increased 9.3% year over year to $1,807 million, on the back of improved gross profit at both Family Dollar and Dollar Tree segments. Gross margin expanded 130 basis points (bps) to 32.1%, owing to reduced merchandise and freight expenses.
Selling, general and administrative expenses decreased 30 bps to 21.7% of sales, primarily benefiting from lower payroll, legal and depreciation costs, partly offset by increased store hourly payroll, advertising, and repairs and maintenance costs.
Balance Sheet
Dollar Tree ended the quarter with cash and cash equivalents of $866.4 million, net merchandise inventories of $2,865.8 million, net long-term debt of $6,169.7 million and shareholders’ equity of $5,389.5 million.
Store Update
Dollar Tree opened 104 outlets, expanded or relocated 27 outlets, and shuttered 55 outlets during the quarter. Moreover, during the quarter, the company launched eight old Family Dollar outlets as Dollar Tree outlets as part of its re-banner efforts. In fiscal 2016, the company opened 584 new stores.
Looking Ahead
Management remains pleased with its fiscal 2016 performance, as it crossed $20 billion in sales, alongside generating record earnings. Further, the company is progressing quite well with Family Dollar’s integration. The company further revealed that it is well on track with its expansion efforts for both Dollar Tree and Family Dollar. The company intends to attract shoppers and enhance customer experience with its diverse reach and desired products. All said, management believes that the company is well placed in the broad retail space, to deliver long-term value to shareholders. Further, the company issued a fresh outlook for the first-quarter and fiscal 2017.
Management projects consolidated net sales for fiscal 2017 in the band of $21.94–$22.33 billion. The guidance stems from comps growth in the range of flat to low single-digit increase and 3.9% increase in square footage. Earnings per share are envisioned in the $4.20–$4.56 range for fiscal 2017, which will include an additional 53rd week. The impact on sales and earnings from the additional week is included in management’s outlook.
For the fiscal first quarter, consolidated sales are projected in the range of $5.26–$5.35 billion, driven by comps growth in the flat to low single-digit increase range for the combined entity. Earnings are anticipated in the range of $0.91–$0.98 per share, compared with adjusted earnings of $0.89 reported in the same year-ago period.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
Dollar Tree, Inc. Price and Consensus
Dollar Tree, Inc. Price and Consensus | Dollar Tree, Inc. Quote
VGM Scores
At this time, Dollar Tree's stock has a great Growth Score of 'A', though it is lagging a lot on the momentum front with a 'D'. However, the stock was allocated a grade of 'A' on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'A'. If you aren't focused on one strategy, this score is the one you should be interested in.
Zacks' style scores indicate that the company's stock is suitable for value and growth investors.
Outlook
Eestimates have been broadly trending downward for the stock. The magnitude of these revisions also indicates a downward shift. Notably, the stock has a Zacks Rank #3 (Hold). We are looking for an inline return from the stock in the next few months.