$Dollar General (DG.US)$ Sales are predicted to grow in 2025, with the highest growth rate expected to exceed Wall Street's expectations, which makes investors optimistic that the company's recent difficulties are easing. The Earnings Reports show that Dollar General's Q4 sales reached 10.3 billion USD, a year-on-year increase of 4.5%, surpassing market expectations; the sales growth was primarily attributed to the contribution from new store sales and the increase in same-store sales, although it was partially offset by the impact of store closures.

Dollar General stated that net sales are expected to grow by 3.4%-4.4% this year. Analysts expect an average growth of about 1.8%; it is anticipated that the diluted EPS will range from $5.10 to $5.80 this year, with the highest expectation slightly below Wall Street's average forecast.

As a result of this news, Dollar General saw an increase of over 5% after the earnings report in the USA.

The company and Other discount stores have been struggling with low-income customers, whose purchasing power has been eroded after years of high inflation. Analysts also stated that large competitors like Walmart are grabbing market share.

In the last quarter, both comparable sales and revenue exceeded expectations, and Dollar General pointed out that the company performed strongly in the consumables category, while seasonal, home, and Outfits categories saw a decline.

Same-store sales increased by 1.2% year-on-year, reflecting a 2.3% increase in average transaction amount, with a 1.1% decrease in foot traffic.

However, the profit performance in the fourth quarter was poor. The EPS was 87 cents, lower than the Wall Street average forecast of $1.50. The company stated that this was due to the costs incurred from reviewing store profiles and closing stores.

Concerns about falling consumer spending have intensified the challenges faced by Dollar General. Retailers such as Walmart, Dick's Sporting Goods, and Macy's have disappointed investors with their outlook for this year. Some chains have noted that President Trump's tariffs could lead to price increases.

The main growth driver for the chain is the opening of thousands of new stores. This year, the retailer's number of stores has exceeded 0.02 million, making it the largest chain in the USA.

Dollar General has initiated a review of the store portfolio for the Dollar General and pOpshelf brand stores, which includes identifying stores that need to be closed or relocated based on evaluations of store performance, future expected performance, and operational conditions. Based on the results of this review, the company plans to close 96 Dollar General stores and 45 pOpshelf stores in the first quarter, and to convert an additional 6 pOpshelf stores into Dollar General stores.

CEO Todd Vasos emphasized, "While the number of stores being closed is less than one percent of our total store count, we believe this decision will allow us to better serve our customers and the Community."

Editor/ping