Dollar General Corp. (NYSE: DG) reported its fiscal fourth-quarter financial results before the markets opened on Thursday. This dollar store giant posted solid numbers on both the top and bottom lines and made a strong case as one of our stocks to own for the next decade.
The company said it had $1.30 in earnings per share (EPS) on $5.29 billion in revenue. That compares to consensus estimates from Thomson Reuters of $1.26 in EPS on revenue of $5.30 billion. In the same period of last year, the retailer posted EPS of $1.17 and $4.94 billion in revenue.
The board of directors recently approved an increase of 14% in the quarterly dividend. The first-quarter dividend of $0.25 per share will be paid on April 12, for shareholders of record on March 29.
Looking forward to fiscal 2016, Dollar General plans to open roughly 900 new stores and relocate or remodel 875 stores over the course of the year. The company also expects net sales to grow 7% to 10% and EPS to grow 10% to 15% for the fiscal year. The consensus estimates call for $4.49 in EPS on $22.10 billion in revenue.
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Dollar General repurchased $1.3 billion worth of shares, or 17.6 million, under its share repurchase program in 2015. The total remaining authorization for future repurchases is approximately $920 million, with no expiration date. The company has a market cap of over $23 billion.
Todd Vasos, CEO of Dollar General, commented on earnings:
Looking ahead, Dollar General continues to have significant opportunities for growth. The goal of our long-term growth model that we announced today is to drive 11% to 17% total annual shareholder return per year through EPS growth and dividend yield. Considering the financial results we have delivered over the last three years and consistent with how we are managing the business, our growth model is focused on increasing long-term shareholder value by driving profitable sales growth, capturing growth opportunities, enhancing our position as a low-cost operator and investing in our people. For 2016, we plan to return approximately $1.3 billion to shareholders through anticipated quarterly cash dividends and consistent share repurchases.
On the books, cash and cash equivalents totaled $157.9 million at the end of the fourth quarter, compared to $579.8 million in the same period from last year.
Shares of Dollar General were up 7.1% to $80.60 Thursday morning, with a consensus analyst price target of $82.87 and a 52-week trading range of $59.75 to $81.42.
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