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Investing.com – Dollar General (NYSE:DG) shares fell 4% in Thursday’s trade after the company warned of lower sales in 2021.
The latest $1,400 stimulus checks and the discount retailer’s promise of more share buybacks failed to change today’s market sentiment for the stock.
Dollar General benefited from the lockdowns as the pandemic-fueled nervousness had more people taking to its discounted stores to stock up on groceries. That burst in sales is expected to taper as more people get vaccinated and get back to leading normal lives.
The company said it expects full-year same-store sales to fall 4% to 6%, compared with analysts’ estimate of a 1.2% decline, according to IBES data from Refinitiv. Overall net sales are expected to be flat to 2% lower, against estimates of a 1.4% increase.
“Significant uncertainty continues to exist regarding the severity and duration of the COVID-19 pandemic, including its impact on the US economy, consumer behavior and the company’s business,” Dollar General said in a statement.
The company repurchased $2.5 billion of its common stock, or 12.3 million shares last year. The total remaining authorization for future repurchases was $679 million at the end of fiscal year 2020. On March 17, the company’s board increased the authorization by $2 billion.
