The maker of salsas sold at Dollar Tree and Deals, Dollar Express and Dollar Bills stores nationwide is recalling the product after large glass pieces were found in some jars.
Source: FULL ARTICLE at Fox US News
Tag Archives: Dollar Tree
Midday Report: Family Dollar Reports Miserly Q1 Earnings
Filed under: Earnings, Retail, Market News
Family Dollar (FDO) says its quarterly earnings rose by less than three percent, falling shy of Wall Street expectations.
But the company had plenty of excuses for the shortfall: It blames the economy, the weather, and the delay in tax refunds earlier this year.
And Family Dollar doesn’t see things getting a whole lot better. It revised its earnings forecast for 2013 significantly lower for the second time this year.
But not everything is bleak. Sales rose by 18 percent in the latest quarter, meeting expectations, as the company continued to add stores at a rapid pace. It opened 500 new locations last year and is expected to add that many again this year. It now has more than 7,000 stores. And the sale trend improved in February as customers began to receive their tax refund checks.
But analysts say there are bigger trends working against Family Dollar and its main rivals – Dollar General (DG) and Dollar Tree (DLTR). The biggest factor is that Walmart (WMT) has stepped up its competition to win the dollars of hard-pressed shoppers by lowering prices.
Family Dollar is trying to make itself a one-stop destination by adding cigarettes, Pepsi (PEP) products, gift cards and magazines. This strategy may draw more customers into its stores, but these are generally very low margin products compared to apparel and other items – and that has pressured profitability.
That’s in contrast to what happened in recent years, during and right after the recession. Sales and earnings soared as low-income shoppers flocked to dollar stores.
Family Dollar has also underperformed on Wall Street. So far this year, its stock is down seven percent. By comparison, both Dollar General and Dollar Tree have gained 15 percent this year.
It was just over a year ago that Family Dollar rejected a $7 billion buyout offer from Trian Group, the firm run by activist investor Nelson Peltz.
-Produced by Drew Trachtenberg
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Source: FULL ARTICLE at DailyFinance
Family Dollar Earnings: An Early Look
By Dan Caplinger, The Motley Fool
Filed under: Investing
Spring is finally here, and a new earnings season is right around the corner. On Wednesday, Family Dollar will release its latest quarterly results. The key to making smart investment decisions on stocks reporting earnings is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed, knee-jerk reaction to news that turns out to be exactly the wrong move.
The deep-discount industry has seen huge growth in recent years, as a sluggish economic recovery has left millions of Americans behind, struggling to make ends meet. Yet highly competitive conditions in the industry have left Family Dollar fighting with a number of peers for market share. Let’s take an early look at what’s been happening with Family Dollar over the past quarter and what we’re likely to see in its quarterly report on Wednesday.
Stats on Family Dollar
|
|
|
|---|---|
|
Analyst EPS Estimate |
$1.23 |
|
Change From Year-Ago EPS |
7% |
|
Revenue Estimate |
$2.89 billion |
|
Change From Year-Ago Revenue |
17.6% |
|
Earnings Beats in Past 4 Quarters |
1 |
Source: Yahoo! Finance.
Is Family Dollar’s stock its best bargain?
Analysts have gotten more pessimistic about Family Dollar‘s earnings in recent months, as they’ve cut their estimates on the just-ended quarter by $0.04 per share and notched $0.09 off full-year fiscal 2013 earnings-per-share figures. The stock has reflected that dour view, dropping 6% since the beginning of the year.
After years of strength, Family Dollar has recently found itself on shakier ground. The same slow economic conditions that led to its strong performance during the 2008 recession continue to exist today, but now, even deep-discount retailers have proven vulnerable to tough times among its customers.
In particular, a combination of rising payroll taxes, higher prices at the pump, and weak employment growth has held spending back among lower-income shoppers. Wal-Mart‘s tepid 1% rise in same-store sales in the U.S. might have been good news for Family Dollar in years past, but Family Dollar‘s move toward more food items has put margins under pressure, and the stock hasn’t responded favorably.
Perhaps most troubling for Family Dollar are the moves that its competitors are making. Dollar General has done its best to hold off rising competition by aggressively expanding, with plans to open 635 new stores this year. The move could hurt short-term margins, but it throws down the gauntlet for Family Dollar to keep up the pace. Meanwhile, Dollar Tree reported surprisingly strong results in its most recent quarter as its cost-cutting bore fruit for investors.
In Family Dollar‘s quarterly report, watch for the company to address how it plans to respond to Dollar General‘s aggressive expansion plans. In this increasingly dog-eat-dog industry, Family Dollar can’t afford to let its rivals get too far ahead if it wants to retain its leadership …read more
Source: FULL ARTICLE at DailyFinance
Five Below Earnings: An Early Look
By Dan Caplinger, The Motley Fool
Filed under: Investing
Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and Five Below is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.
The teen and preteen retail market is a tough place to be, with fickle customers moving quickly from one hot trend to the next without building much loyalty along the way. But Five Below hopes to tap the success of the dollar-store retail trend and adapt it to accessories and other merchandise, keeping prices of all of its products at $5 or less. Let’s take an early look at what’s been happening with Five Below over the past quarter and what we’re likely to see in its quarterly report on Wednesday.
Stats on Five Below
|
Analyst EPS Estimate |
$0.38 |
|
Change From Year-Ago EPS |
153% |
|
Revenue Estimate |
$170.2 million |
|
Change From Year-Ago Revenue |
35% |
|
Earnings Beats in Past 2 Quarters Since IPO |
2 |
Source: Yahoo! Finance.
Will Five Below give investors what they want this quarter?
Analysts have stuck by their original estimates on Five Below‘s earnings in recent months, keeping their calls unchanged both for the just-ended holiday quarter and the full 2014 fiscal year. The stock, though, has rocketed higher, jumping 25% since mid-December.
We’ve already received some positive signs about Five Below’s holiday quarter, as the company released early guidance back in January. With an increase in its anticipated ranges for revenue and earnings, Five Below said that same-store sales rose 4.2% for the first 11 weeks of the quarter. Even though existing major shareholders took the opportunity to announce a secondary offering of 8.1 million shares, the stock rallied in response.
The key to Five Below‘s success is capitalizing on cash-strapped kids. Dollar Tree and Family Dollar established the success of that business model in general merchandise retail, one-upping behemoth discounters with their deeper-discount strategy and gaining market share during the recession and slow recovery over the past several years. Similarly, Five Below hopes to grab share from privately held competitors Claire’s Stores and Forever 21 as young customers seek to economize.
In its quarterly report, watch for Five Below to discuss its expansion plans into Texas. With expectations to open 15 stores in the Lone Star State, Five Below believes that the strong Texas economy should translate into strong sales there. If it’s right, then Five Below could be entering another big growth spurt.
The retail space is in the midst of the biggest paradigm …read more
Source: FULL ARTICLE at DailyFinance
Has Dollar Tree Become the Perfect Stock?
By Dan Caplinger, The Motley Fool
Filed under: Investing
Every investor would love to stumble upon the perfect stock. But will you ever really find a stock that provides everything you could possibly want?
One thing’s for sure: You’ll never discover truly great investments unless you actively look for them. Let’s discuss the ideal qualities of a perfect stock, then decide if Dollar Tree fits the bill.
The quest for perfection
Stocks that look great based on one factor may prove horrible elsewhere, making due diligence a crucial part of your investing research. The best stocks excel in many different areas, including these important factors:
- Growth. Expanding businesses show healthy revenue growth. While past growth is no guarantee that revenue will keep rising, it’s certainly a better sign than a stagnant top line.
- Margins. Higher sales mean nothing if a company can’t produce profits from them. Strong margins ensure that company can turn revenue into profit.
- Balance sheet. At debt-laden companies, banks and bondholders compete with shareholders for management’s attention. Companies with strong balance sheets don’t have to worry about the distraction of debt.
- Money-making opportunities. Return on equity helps measure how well a company is finding opportunities to turn its resources into profitable business endeavors.
- Valuation. You can’t afford to pay too much for even the best companies. By using normalized figures, you can see how a stock‘s simple earnings multiple fits into a longer-term context.
- Dividends. For tangible proof of profits, a check to shareholders every three months can’t be beat. Companies with solid dividends and strong commitments to increasing payouts treat shareholders well.
With those factors in mind, let’s take a closer look at Dollar Tree.
|
Factor |
What We Want to See |
Actual |
Pass or Fail? |
|---|---|---|---|
|
Growth |
5-year annual revenue growth > 15% |
11.8% |
Fail |
|
1-year revenue growth > 12% |
11.5% |
Fail |
|
|
Margins |
Gross margin > 35% |
35.9% |
Pass |
|
Net margin > 15% |
8.4% |
Fail |
|
|
Balance sheet |
Debt to equity < 50% |
16.3% |
Pass |
|
Current ratio > 1.3 |
2.18 |
Pass |
|
|
Opportunities |
Return on equity > 15% |
41.1% |
Pass |
|
Valuation |
Normalized P/E < 20 |
17.15 |
Pass |
|
Dividends |
Current yield > 2% |
0% |
Fail |
|
5-year dividend growth > 10% |
0% |
Fail |
|
|
Total score |
5 out of 10 |
Source: S&P Capital IQ. Total score = number of passes.
Since we looked at Dollar Tree last year, the company hasn’t been able to regain the point it lost from 2011 to 2012. The shares have also struggled, just barely managing to claw back to break-even over the past year.
Throughout much of the slow recovery in the economy in the past several years, deep-discount retailers have performed exceedingly well. By selling low-cost but high-margin merchandise, Dollar …read more
Source: FULL ARTICLE at DailyFinance