Dollar General fights back from falling earnings as bulls seize 2023 potential

Beats Dollar General's fourth-quarter earnings estimates

Justin Sullivan

Dollar Corporation (NYSE:FIRE) is slowly recovering from the slump following last week’s earnings report as the retailer sets up Profit guidance below expectations.

Morgan Stanley is one of those bullish companies that defends stocks on Monday. analyst Simeon Gutman and team said they were caught off guard by the DG report and did not anticipate a confluence of such headwinds that would impact business at the same time. However, the company does not expect a negative revision cycle to begin.

Importantly, comparable sales growth is forecast to remain in the 6% to 8% range through Q2 2023 based on a year-to-year and multi-year comparative cadence, annual inflation benefits, and more. years and ongoing trade-offs from consumers. Morgan Stanley’s update said: “The level of revenue consistency in the face of difficult/unpredictable demand stands out in our view.”

Looking ahead, healthy double-digit EPS growth is expected to continue into 2023, and the stock’s post-earnings slump is thought to appropriately dampen the 2023 outlook. reduced from MS’s point of view.

DG is known as the defensive focal point in the context that the market will continue to favor defensive names at least until the first half of 2023.

Morgan Stanley holds an Overweight rating on Dollar General (FIRE) while cutting the price target from $270 to $260.

Shares of Dollar General (FIRE) get a raise 0.48% at 3:35 p.m. Monday and was on track for a second straight gain after the earnings report crash. The stock recovered more than two-thirds of its share price decline shortly after the earnings report was released.

Seeking Alpha author Bela Lakos also defends Dollar General (FIRE) after the stock price falls. “Net revenue growth, combined with earnings growth, is signaling that demand for Dollar General Corporation’s products remains strong, while the company has managed to effectively control costs.” , the report wrote. Optimistic assessment of retail stocks.


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