Discount retailers Five Below and Dollar General were in motion Thursday after wrapping up their financial calendars. Five Below edged out expectations for its results late Wednesday. Dollar General posted mixed results Thursday morning. FIVE stock and DG stock retreated Thursday.
Five Below Earnings
Philadelphia-based dollar store chain Five Below operates 1,292 locations in 42 states. Despite its Q3 earnings beat in December, the company has averaged a 32.7% earnings decline over the past three quarters.
For the fourth quarter, Five Below earnings popped 23% to $3.07 per share on 12.7% revenue growth to $1.12 billion. The results edged out analyst expectations of $3.06 earnings per share on $1.1 billion in sales, according to FactSet.
Comparable sales rose 1.9%, topping forecasts of 0.9% growth.
For its upcoming first quarter, Five Below guided earnings to range from 59 cents to 65 cents per share on $723 million to $735 million in net sales. The outlook is below the FactSet earnings forecast of 69 cents per share on $731 million in revenue.
The company plans to open a record 200 stores in 2023, up from 150 new stores in 2022.
Five Below expects fiscal 2023 earnings to range from $5.25 to $5.76 per share on $3.49 billion to $3.59 billion in sales. It recorded $4.69 earnings per share and $3.07 billion in sales for FY22. The company sees comparable sales increasing 1% to 4%. Wall Street sees full year earnings at $5.65 per share and $3.58 billion in revenue, with 2.8% comparable sales growth.
FIVE Stock
FIVE shares pulled back from their February peak of 212.56 after breaking out from a flat base on Jan. 13. The stock is up 10.4% year to date but down about 5.9% over the past month. FIVE stock fell 1.4% Thursday, moving just below the 50-day line.
Dollar General Earnings
Goodlettsville, Tenn.-based Dollar General posted mixed results for its Q4 results Thursday morning. The company's earnings growth increased for the third consecutive period, jumping 14.7% to $2.96 per share, while revenue accelerated for the fourth quarter in a row, surging 17.9% to $10.2 billion. Dollar General's earnings edged out Wall Street estimates of $2.95 per share, but sales came in short of analyst forecasts of $10.24 billion. Same-store sales increased 5.7% for the quarter, just shy of forecasts for 5.8% growth, according to the consensus of analysts polled by FactSet.
In the company's Q3 earnings miss, Dollar General guided fourth-quarter earnings between $3.15 and $3.30 per share. Same store sales are seen growing 6% to 7% for the quarter.
For Dollar General's 2023 fiscal year, the discount chain guided 4% to 6% diluted EPS growth on 5.5% to 6% net sales growth, compared to 5% earnings growth and a 10.6% net sales increase for 2022. Same-store sales growth is expected to range from 3% to 3.5%, slumping from the 4.3% growth in 2022.
Dollar General anticipates capital expenditures ranging from $1.8 billion to $1.9 billion for FY23. The company plans to invest $100 million in its stores, primarily in incremental labor hours. And Dollar General expects to open 1,050 new stores, remodel 2,000 locations and relocate 120 of its shops.
The FactSet consensus forecasts 5.7% earnings growth to $11.29 per share on 5.8% revenue growth to $40.05 billion.
DG Stock
Dollar General stock retreated from its late October high of 261.59 after failing to break out from a cup base following the third quarter earnings report. Shares are down 13.9% year to date and trading at their lowest level since June. DG stock slipped 2.95% Thursday, erasing its Wednesday gains.
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