Dollar General, Kroger – 24/7 Wall St.
Three companies we’ve covered in previous snapshots announced their results ahead of the market opening on Thursday. Solar cell and module maker JinkoSolar missed revenue but topped profit estimates, while social media platform Hello World (aka Momo) beat both. Clothing retailer Chico’s FAS also beat the two. However, the three traded lower, shortly after Tuesday’s opening bell.
After markets close on Tuesday, Hewlett Packard Enterprise and Salesforce.com will report their results. We haven’t previewed any of the few companies that were due to release their results on Wednesday morning.
We’ve already posted our snapshots of three software companies that will release their quarterly results after markets close on Wednesday: CrowdStrike, Snowflake and Splunk.
Here’s a look at two retailers who are expected to release their quarterly results before the markets open on Thursday.
Since rival Dollar Tree released results last week and announced that it would start pricing its products at $ 1.25, shares of Dollar General Corp. (NYSE: DG) fell only less than 1%. Over the past 12 months, Dollar General stock has gained around 3.3%, while Dollar Tree has risen nearly 24% over the same period. But virtually all of this gain has come in since mid-November, and most of it has come from the announced price increase. What will Dollar General do?
Analysts are firmly optimistic about the title. Of the 27 brokerages covering the non-priced retailer, 22 rated the stock as a strong buy or buy, and three others rate the stock as held. At a recent price of around $ 223.60 per share, the upside potential based on a median price target of $ 252 is 12.7%. At the high price target of $ 272, the upside is 21.6%.
Third-quarter revenue is expected at $ 8.49 billion, which would be down nearly 2% sequentially but up 3.5% year-over-year. Adjusted earnings per share (EPS) is expected at $ 2.01, down 25% sequentially and 13% year-over-year. For the 2022 fiscal year ending in January, Dollar General is currently expected to report EPS of $ 10.21, down 3.8%, on sales of $ 34.24 billion, up 1.5%.
Dollar General’s price-to-earnings ratio for fiscal 2022 is 21.9. For fiscal year 2023, the multiple to estimated EPS of $ 11.23 is 19.9, and for 2024, it is 17.9 times estimated EPS of $ 12.49. The stock’s 52-week range is $ 173.50 to $ 239.35. The company pays an annual dividend of $ 1.68 (0.75% yield). The total shareholder return for the past year is 3.1%.
Grocery operator Kroger Co. (NYSE: KR) has added about 33% to its share price over the past 12 months. Competitor Albertson’s has seen its share price jump 127% over the past 12 months and that’s the kind of performance Kroger would like to see.
Kroger is expanding in Florida with a delivery-only service and no physical store. It could be a big win for Kroger in a state where there are a lot of retirees who could accommodate the service and a lot of snowbirds who would rather sit in the sun than go for a chore that they will have to get back to soon enough. . The first distribution center, near the Florida-Georgia border, recently opened and will be a hub to serve customers within a 90-mile radius.
Of 27 analysts covering the stock, 15 have a hold rating on the stocks. The other 12 are divided equally by the Strong Buy / Buy and Strong Sell / Sell odds. At a stock price of around $ 42.30, the upside potential based on a median price target of $ 43 is around 1.7%. At the high price target of $ 54, the upside is 27.7%.
Third-quarter revenue is expected at $ 31.19 billion, down about 1.6% sequentially and up nearly 5% year-over-year. Adjusted EPS is $ 0.67, down 16.6% sequentially and 5.6% year-on-year. For the 2022 fiscal year ending in January, Kroger is expected to post EPS of $ 3.33, down 4.1%, on sales of 135.82, up 2.5%.
Kroger’s price / earnings multiple for fiscal 2022 is 12.7. For fiscal 2023, the multiple to estimated EPS of $ 3.26 is 12.9, and for 2024, it is 12.8 times estimated EPS of $ 3.29. The stock’s 52-week range is $ 30.35 to $ 47.99. The company pays an annual dividend of $ 0.84 (yield 1.98%). The total shareholder return for the past year is 30.6%.