Dollar General shares climb as budget shoppers boost sales
The retailer has seen steady consumer demand even as profits get squeezed.
Shares of Dollar General climbed 5% in early trading Thursday after the discount retailer posted mixed fourth-quarter results.
Revenue narrowly topped analysts’ expectations at $10.3 billion. Home products drove the bulk of sales, followed by apparel and seasonal goods. Same-store sales also beat, growing 1.2%.
Earnings per share came in at $0.87, including $0.81 of one-time items like impairment charges and a review of the company’s store portfolio. Analysts polled by FactSet had expected EPS of $1.51. Operating profit sank 49% to $294.2 million, hurt by $232 million in charges tied to store portfolio optimization.
As part of that strategy, Dollar General plans to close 96 of its core stores and 45 Popshelf locations in Q1, while converting six Popshelf stores into its main Dollar General format. Popshelf, which launched in 2020, targets a slightly more upscale bargain shopper with home decor, beauty, and seasonal items at higher price points than the flagship chain. Despite the closures, Dollar General is still in expansion mode: the company opened 725 stores, remodeled 1,621, and relocated 85 last year.
For 2025, Dollar General expects same-store sales growth of 1.2% to 2.2%, roughly in line with Wall Street’s estimate of 1.8%. EPS is projected to land between $5.10 and $5.80, trailing Wall Street’s forecast of $5.83. Shares of rival Dollar Tree also ticked up following the results, and the chain is set to report its own earnings next Wednesday.
