Save Your (Family) Dollars

Family Dollar's (FDO Quote) second-quarter earnings report Thursday showed that the discount retailer has made some strong strategic moves.

For the quarter ended March 3, the company posted earnings of 60 cents a share on revenue of $1.95 billion, matching analysts' estimates. Earnings were 35 cents a share a year ago, when results included an 18-cent litigation charge.

Family Dollar also reaffirmed guidance for the current quarter and year, forecasting earnings of 39 cents to 43 cents a share for the third quarter and $1.63 to $1.69 for the year. Wall Street currently expects earnings of 41 cents a share for the quarter and $1.65 for the year.

I like what I'm seeing at Family Dollar. The company's margins are improving, and it has been smart in adding consumables and focusing on an urban strategy to enhance performance. ...