Family Dollar Continues Its Impressive Results (FDO)

Family Dollar Stores, Inc. FDO reported strong earnings this morning, reporting earnings of 56 cents per share, 5 cents better than analysts had been expecting. This was a rise of 23% from a year ago. Revenues were up 8% to $1.96, in line with expectations. Family Dollar was positive in its view for fiscal 2011, giving earnings guidance of $2.95-$3.15, sharply higher than the $2.96 Wall Street was expecting. In addition to the strong guidance, Family Dollar announced a $750 million buyback. Howard R. Levine, Chairman and Chief Executive Officer was positive on the results. He said, "Our efforts to broaden the appeal of our assortment, improve the in-store shopping experience, enhance our customer communications, and strengthen our employee teams, resulted in strong improvements across most key metrics." Levine went on to say, "I am very proud of this performance, and I appreciate the hard work and dedication of all our 50,000 Family Dollar Team Members." Levine was positive on 2011, saying the company expects to build on 2010's momentum. "In fiscal 2011 we intend to build on the momentum we achieved in fiscal 2010 and continue to increase our focus on driving stronger revenue growth,” continued Mr. Levine. “We intend to make additional investments that strengthen our value and convenience proposition. Key areas of focus include the acceleration of new store growth and the launch of an aggressive store renovation program. We plan to open approximately 300 new stores, a 50% increase over fiscal 2010 openings, and renovate 600-800 stores." Family Dollar is a major position of activist investor Nelson Peltz. Shares of Family Dollar gained 37 cents yesterday to $43.34 in the regular session yesterday, and an additional 21 cents in after-hours trading.