Dollar General Corporation (
recently announced that it has completed $200 million share
buybacks, indicating its commitment toward utilizing cash flow to
enhance stakeholders' return.
This discount store operator has bought back approximately
$220 million worth of shares year to date. Since the inception of
the share repurchase program in Dec 2011, the company has
repurchased 23.6 million shares for about $1.1 billion, and has
approximately $424 million left under the current
The company stated that a strong balance sheet and healthy
cash flow generation poise it well to enhance shareholders' value
through share repurchases. During the last reported quarter the
company bought back 0.4 million shares for $20 million.
Earlier this month, Dollar General posted lower-than-expected
first-quarter 2013 results and consequently clipped its fiscal
2013 outlook. The company posted adjusted quarterly earnings of
71 cents a share that jumped 13% year over year but missed the
Zacks Consensus Estimate by a penny.
The company expects adverse sales mix and macro headwinds to
continue to deter its financials. Consequently, the company
lowered the upper guidance range of its previous forecast.
This Zacks Rank #3 (Hold) company now expects fiscal 2013
earnings to be in the range of $3.15 - $3.22 per share compared
with its earlier guidance range of $3.15 - $3.30.
Total sales are expected to rise by 10% to 11% year over year,
while same-store sales are expected to increase by 4% to 5%.
Gross margin is expected to decline compared with the prior year,
while adjusted operating profit is expected to be in the range of
$1.73 billion - $1.77 billion.
Other Stocks to Consider
Until any further upgrade in Dollar General's Zacks Rank,
other well performing stocks in the retail, wholesale sector
Big 5 Sporting Goods Corp
), which carries a Zacks Rank #1 (Strong Buy).
The Gap, Inc
), carrying a Zacks Rank #2 (Buy) are also worth considering.
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