shares dollar tree It fell nearly 15% in early trading Thursday after the company missed Wall Street’s earnings forecasts for the fourth quarter and lowered its earnings forecast for the full year.
Here’s how discounting fared in the fiscal first quarter compared to what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $1.47, adjusted, vs. $1.52 expected
- he won: 7.32 billion dollars, compared to the expected 7.28 billion dollars
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The company’s reported net income for the three-month period ended April 29 was $299 million, or $1.35 per share, compared to $536.4 million, or $2.37 per share, a year earlier. On an adjusted basis, the company reported earnings of $1.47 per share, below Wall Street expectations.
Sales rose to $7.32 billion from $6.9 billion a year earlier.
Same-store sales increased 4.8% compared to an expected increase of 3.6%, according to Street Account estimates.
After the disappointing quarter, Dollar Tree cut its full-year earnings forecast to a range of $5.73 to $6.13 per share, down from the previous range of $6.30 to $6.80 per share. Analysts polled by Refinitiv were expecting full-year earnings of $6.68 per share.
Dollar Tree CEO Rick Drilling said in a press release that the lower forecasts were attributed to higher deflation, items that have been damaged, lost or stolen, and a shift in the product mix to consumables, which carry lower profit margins.
“While we are seeing early results from our initiatives, we are not immune to the external pressures that affect all retail,” said Drilling.
“While we maintain our full-year 2023 sales outlook, we are revising our earnings per share outlook, as we expect continued high contraction and an unfavorable sales mix through the balance of the year. We continue to expect earnings to be a more loaded year as the benefits of lower ocean freight rates flow through.” .
The company has largely maintained its full-year sales forecast, however, projecting net sales in the narrow range of $30 billion to $30.5 billion. Its forecast of comparable store sales is low to mid-single digits.
For the second quarter, the company expects EPS of 79 cents to 89 cents in the second quarter versus Refinitiv’s estimate of $1.22.