Dollar Tree Inc. (NASDAQ:DLTR) opened 10% higher today as a result of very positive second quarter results.
The discount retailer reported earnings per share of $0.98, or $233.8 million in net income, far above its year previous benchmark of $0.72 and the FactSet consensus of $0.87 per share. The company also outperformed FactSet’s $5.24 billion estimate for sales, coming in with an admirable $5.28 billion for the second quarter. Same-store sales increased 3.9% for the Dollar Tree, while the related Family Dollar grew 1%.
The company also opened 133 new stores, expanded of relocated 31 and closed 34 stores in Q2. "Both Dollar Tree and Family Dollar produced positive same-store sales, our enterprise operating margin improved 80 basis points and earnings per share exceeded the high end of our guidance range. Consumers continue to view Dollar Tree and Family Dollar as stores that provide great value and convenience,” said Bob Sasser, CEO.
The momentum of this quarter has resulted in an updated guidance, with Q3 net sales expected in the range of $5.2 billion to $5.29 billion, as well as a Diluted EPS in the range of $0.84 to $0.90. Full year guidance also received some facelifts, with net sales for full year fiscal 2017 expected to range from $22.07 billion to $22.28 billion and the diluted EPS for fiscal 2017 to come in around $4.44 to $4.60. Even as Walmart and Amazon’s battle heats up, there is still a niche for well-placed retailers and Dollar Tree looks to be one of them.