While Nvidia earnings transfix the market, dollar store Five Below dipped after initially rising on better-than-expected results. Meanwhile, Ollie's Bargain Outlet tumbled following its Q2 report and Dollar General rolled into a steep dive.
Ollie's Bargain Outlet reported early Thursday its Q2 earnings grew 16% to 78 cents per share while sales increased 12% to $578.4 million. Comparable sales increased 5.8%, the company reported. Prior to the report, analysts projected Q2 EPS of 78 cents and revenue totaling $562 million. The consensus view also had same-store sales increasing 1.7%.
The discount retailer also revised its full-year guidance, expecting sales of $2.276 billion to $2.291 billion, up from its previous range that topped out at $2.277 billion. The company also projects a same-store sales increase of 2.7% to 3.2%, compared to its last forecast of 1.5% to 2.3%.
Meanwhile, Five Below late Wednesday announced that second-quarter earnings dropped 36% to 54 cents per share, in line with expectations. However, revenue increased 9% to $830 million, topping analyst predictions of $823.3 million. Five Below also now projects full-year earnings of $4.35-$4.71, down from an earlier forecast calling for 2024 EPS of $5-$5.40.
Same store sales fell 5.7% during the quarter. Brokerage Craig-Hallum upgraded the stock to buy, from hold, following the report.
Nasdaq Reverses Lower On Nvidia Sell-Off; Fed Inflation Data Due
Discount Stocks Discounted
Five Below stock declined 0.9% to 78.24, hitting an intraday high of 83.83, during Thursday's market session. Ollie's Bargain Outlet erased early gains and dropped 7.6%. Meanwhile, Dollar General stock retreated more than 30% after missing on second-quarter earnings and revenue. Dollar General saw quarterly EPS fall 20% while sales declined 4%.
Shares of Ollie's Bargain Outlet are basing with an official 104.98 entry, its July 15 high, according to MarketSurge chart analysis. Five Below is attempting to break out above its 50-day moving average, after a steep five-month decline.
Dollar General stock had also been attempting to retake support at its 50-day line. Thursday's move pointed to an undercut of October lows, which would put shares at their lowest level since June 2018.
Discount retailers, at large, tend to be a classic defensive growth play that can do relatively well in tougher markets or amid economic uncertainty. They benefit from the consumer trade-down at such times.
Dollar General stock has a 24 Composite Rating out of a best-possible 99. Shares also have a 33 Relative Strength Rating and a 19 EPS Rating.
Please follow Kit Norton on X @KitNorton for more coverage.
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