More customers visited and bought more items at Dollar General and Dollar Tree, a stark contrast to slack sales at higher priced department store chains. Fred Katayama reports.
Sales keep rising at dollar stores while higher priced department stores languish. More customers visited Dollar General and spent more at its stores. Net sales and sales at existing stores rose in the latest quarter as customers loaded their shopping carts with consumables and home products. Even apparel sales, which hit department stores hard, rose. Profit soared nearly 17 percent as cheaper fuel helped lower its costs. RBC Capital Markets analyst Scot Ciccarelli said, "This quarter's results help further enforce the stability and long-term growth potential of the Dollar General model." A similar story at Dollar Tree, whose results were boosted by its purchase of Family Dollar. Customers bought more items, helping boost same-store sales. Profit tripled. Dollar Tree raised its earnings outlook for the full year. BB&T Capital Markets senior analyst Anthony Chukumba said, "... the Family Dollar integration has taken a turn for the better." Shares of both dollar chains rose sharply in early trading.