Here's What You Need to Know Before Dollar General (DG) Reports Earnings Today

Dollar General (DG) is scheduled to post its fourth quarter 2014 earnings results after the market closes on Wednesday.
By Kurumi Fukushima ,

NEW YORK (TheStreet) -- Shares of Dollar General  (DG) - Get Report are higher by 0.92% to $71.68 in late morning trading Wednesday, ahead of the discount retailer's fourth quarter 2014 earnings results, expected to be released after the market closes today.

Analysts expect the company to post earnings of $1.17 per share for the quarter, higher than the $1.01 per share Dollar General reported in the year ago period.

Revenue is expected by analysts to come in at $4.95 billion for the fourth quarter, which represents a 10.1% year over year growth in sales from the $4.49 billion the company posted in the same quarter of last year. 

Goodlettsville, TN-based Dollar General is a discount retailer that sells a selection of merchandise, including consumable products such as food, paper and cleaning products, health and beauty products, pet supplies and tobacco products, as well as non-consumable products.

The company offers merchandise at low prices through 11,215 retail store locations across the country.

Insight from TheStreet's Research Team:

Dollar General is a part of Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Here is what Jim Cramer, Portfolio Manager & Jack Mohr, Director of Research - Action Alerts PLUS had to say about the stock in a recent alert:

We are selling shares ahead of DG's Q4 2014 results on Thursday, as we believe expectations are too high, thereby skewing the risk/reward equation to the downside. Shares have approached our price target (which we recently raised to $76 from $74) given Dollar Tree's strong Q4 results, in which it reported comparable sales of 5.6% vs. 5.3% consensus, as well as a general bullish investor sentiment toward the dollar-store industry. While we certainly appreciate that lower-income consumers benefit the most from low gas prices, we believe the market has adequately priced this impact in, and view Q4 estimates (5%+ comps) as high for a company that has trailed Dollar Tree (DLTR:Nasdaq) in both growth and execution.

We suspect the company will respond to strategic questions (raised following the company's failed Family Dollar bid) by moving unit growth to a higher level. This will pressure profits/returns in the short run but is great in the long run given the strong unit economics. For these reasons, we would like to maintain some exposure to the name for the long term, but believe there are better areas to put our money to work in the near to medium term. We do not want to get too greedy, and are happy to take some more profits off the table following the stock's 5% run over the past month, vs. the S&P down 0.05%.

- Jim Cramer and Jack Mohr, 'Selling Shares in Retailer' originally published 3/10/2015 on ActionAlertsPLUS.com.

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DG data by YCharts

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