Dollar General's Q2 Highlights: Earnings Beat, 4.6% Comps Growth, Stock Buyback Boost & More

Dollar General Corp DG reported second-quarter FY22 sales growth of 9% year-on-year to $9.43 billion, beating the consensus of $9.39 billion.
Same-store sales increased 4.6% versus last year. Positive sales contributions from new stores and growth in same-store sales drove the sales growth.
The gross profit margin for the quarter increased 69 basis points Y/Y to 32.3%. The operating margin was 9.7%, and operating income for the quarter rose 7.5% to $913.4 million.
Also Read: This Analyst Is Bullish On Dollar General, So Long As It Hovers Above This Price Range
The company held $326.3 million in cash and equivalents as of July 29, 2022.
EPS of $2.98 beat the analyst consensus of $2.93.
As of July 29, 2022, total merchandise inventories, at cost, were $6.9 billion, an increase of 25.1% on a per-store basis.
On August 24, 2022, the company’s board increased the authorization under the share repurchase program by $2.0 billion. The company had total remaining authorization for future repurchases of $1.0 billion at the Q2 end.
On August 23, 2022, the company’s board declared a quarterly cash dividend of $0.55 per share on its common stock, payable on or before October 18, 2022, to shareholders of record on October 4, 2022.
DG promoted John Garratt to President and CFO, effective September 1, 2022. Garratt joined Dollar General in 2014 and has served as EVP and CFO since December 2015.
Outlook: Dollar General raised FY22 sales growth to 11% from the previous outlook of 10% - 10.5%. Same-store sales growth of 4.0% - 4.5% (prior 3%-3.5%).
The company continues to expect FY22 EPS growth of 12% - 14%.
The company plans to execute 2,930 - 2,980 (prior view 2,980) real estate projects, including 1,010 - 1,060 (prior view 1,110) new store openings.
Price Action: DG shares are trading higher by 0.18% at $247.90 on the last check Thursday.
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