Family Dollar decided to stick to Dollar Tree and rejected Dollar
General's buyout offer on grounds of antitrust concerns. The giant
that will arise will have the ability of generating sales of over
$18 billion and reach out more consumers through its vast network
of stores. Moreover, the deal could bring breather to Family
Dollar, which has been in troubled waters for some time now. The
heightened competition from other retail bellwethers has affected
the company's profitability. In the recently concluded quarter, the
company saw its earnings per share declining 35.3% year over year,
and missing the Zacks' expectation for the fifth straight quarter.
Battered by a competitive retail landscape, Family Dollar has
outlined a set of strategic actions to rein in the hay wired
financial performance, which has started yielding results. This is
well evident from the comps growth of 1.2% in December.
Consequently, we upgraded our recommendation on the stock to
Founded in 1959 and headquartered in Matthews, NC, Family Dollar
Stores, Inc. (FDO) operates a chain of self-service retail discount
stores in the United States. It offers general merchandise in four
categories: Consumables, Home Products, Apparel and Accessories,
and Seasonal and Electronics. The company trades in merchandise
generally priced in the range from under $1 to $10. The company
operates over 8,101 general merchandise retail discount stores
across 46 states, as of November 29, 2014.
The company offers general merchandise in four categories:
Consumables, Home Products, Apparel and Accessories, and Seasonal
The Consumables category (73% of fiscal 2014 total revenue)
consists of household chemicals paper products candy, snacks and
other food health and beauty aids hardware and automotive supplies
and pet food and supplies.
The Home Products category (10% of fiscal 2014 total revenue)
includes domestic items, such as blankets, sheets, and towels
housewares giftware and home decor.
The Apparel and Accessories category (7% of fiscal 2014 total
revenue) comprises men's and women's clothing boys', girls' and
infants' clothing shoes and fashion accessories.
The Seasonal and Electronics category (10% of fiscal 2014 total
revenue) includes toys, stationery and school supplies seasonal
goods and personal electronics, including pre-paid cellular phones
Family Dollar Stores Inc. (FDO): Read the Full
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