Dollar Tree Inc. (DLTR – Analyst Report), one of the leading operators of discount stores, came out with first-quarter fiscal 2015 results, wherein earnings of 71 cents per share surged 6% from the prior-year quarter. However, the company’s bottom line fell short of the Zacks Consensus Estimate of 74 cents.
The company provided second-quarter fiscal 2015 earnings guidance in the range of 63–68 cents per share. It also raised its fiscal 2015 earnings forecast to $3.32 to $3.47 per share, compared with $3.30 to $3.50 guided earlier.
Earnings Estimate Revision: The Zacks Consensus Estimates have remained unchanged in the last 30 days. However, the company surprise history gives a mixed picture. Of the trailing four quarters, including the quarter under review, the company has surpassed the Zacks Consensus Estimate in two quarters and missed the same in two quarters. This leads to an average negative surprise of 0.8%.
Revenues: Dollar Tree generated total revenue of $2,176.7 million that increased 8.8% year over year, but missed the Zacks Consensus Estimate of $2,197 million. Consolidated comparable-store sales jumped 3.4% on a constant currency basis.
Management also raised its fiscal 2015 forecast for net sales in the band of $9.24 to $9.42 billion, versus $9.21 to $9.45 billion estimated earlier. For the second quarter sales is projected between $2.17 billion and $2.23 billion.
Key Events: Dollar Tree is on track with completing the pending Family Dollar acquisition. It is moving ahead with the Federal Trade Commission (“FTC”) and divesture buyers as it plans to divest nearly 330 Family Dollar stores. The company expects to sign agreements with these buyers in coming days and subsequently secure FTC approval to complete the acquisition by early Jul 2015.
Zacks Rank: Currently, Dollar Tree carries a Zacks Rank #3 (Hold) which is subject to change following the earnings announcement.
