Dollar General's Poised for Post-Pandemic Success
Dollar General's (NYSE: DG) strong fiscal first-quarter (ended May 1, 2020) results should come as no surprise to anyone. After all, local authorities deemed it an essential business, allowing its doors to remain open through the pandemic (albeit with altered options, such as reduced hours), unlike other retailers that had to close their physical locations.
Its same-store sales (comps) jumped 21.7% driven by both higher spending and increased traffic. The higher sales drove increased profitability despite elevated expenses related to the coronavirus (e.g., increased bonuses for employees), with Dollar General's diluted earnings per share (EPS) rising 73% from $1.48 to $2.56. Management admits the coronavirus pandemic significantly helped results as people rushed out to buy consumables like paper goods, food, and cleaning products, although it didn't quantify the impact.
The company is not merely temporarily benefiting from the stay-at-home orders, however. Dollar General has several attributes that make it appealing to investors.
Source Fool.com
