NEW YORK (TheStreet) -- Shares of Dollar General (DG) - Get Report are climbing 2.02% to $89.79 late Friday morning after the Goodlettsville, TN discount retailer reported strong 2016 first quarter earnings after yesterday's market close.
Dollar General reported earnings of $1.03 per diluted share, up 23% from the previous year's first quarter of 84 cents per share, and beating Wall Street estimates of 95 cents per share. The company reported revenue increased 7% year-over-year to $5.27 billion, narrowly missing analysts' expectations of $5.28 billion.
Dollar General's same-store sales rose 2.2% in the first quarter, missing Wall Street's consensus of 2.4% growth.
Earlier this morning, Jefferies increased its price target to $101 from $97 and reiterated its "buy" rating on the stock.
"We think similar to other retailers, DG's seasonal businesses were affected in April, but DG executed well against a tough backdrop as comp sales were within our expectations," Jefferies analysts said in an investor note, adding they predicted a sales growth of 2% to 2.2%.
Dollar General's sales growth should continue to strengthen as low-income families continue to turn to bargain stores, the firm noted.
Separately, TheStreet Ratings rated Dollar General as a "buy" with a score of A.
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon.
Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that are rated.
The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, increase in net income and notable return on equity.
TheStreet Ratings feels its strengths outweigh the fact that the company shows low profit margins.
You can view the full analysis from the report here: DG