Soft comp drives EPS miss
DG reported a ~110bps comp miss, with the release noting a "significant weather-related headwind" in the quarter. Despite strong gross margin (+17bps YoY), operating margins declined 43bps YoY, missing expectations by ~30bps, with labour and occupancy costs both de-levering on the +2.1% comp. Similar to other retailers, such as HD, AZO and TGT, stronger sales were highlighted at the start of Q2, leading management to maintain FY guidance for all metrics. The comp miss is still likely to be overshadow this however.Dollar General is a discount retailer. The company's consumables products includes paper and cleaning products, packaged food, perishables, snacks, health and beauty, pet, and tobacco products. The company's seasonal products include decorations, toys, batteries, small electronics, greeting cards, stationery, prepaid phones and accessories, gardening supplies, hardware, automotive and home office supplies. The company's home products include kitchen supplies, cookware, small appliances, light bulbs, storage containers, frames, candles, craft supplies and kitchen, bed and bath soft goods. The company's apparel includes casual everyday apparel, as well as socks, underwear, disposable diapers, shoes and accessories.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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