Dillard’s Inc. (DDS), the leading apparel and home-furnishing retailer in the United States, reported a decline of 1% in same store sales for the four-week period ended February 26, 2011. Results of the month compared unfavorably with same store sales increasing 2% for the four- week period ended February 27, 2010.
Merchandise sales for the period inched down 1% to $492.6 million compared with flat sales for the four-week period ended February 27, 2010. The sales trend was above average in the western region but slightly below average in the Eastern region. However, Central region sales remain consistent with the trend. Category-wise, sales in the home and furniture category and the men’s category were substantially below trend for the four-week period ended February 26, 2011.
Dillard’s posted earnings of $1.55 a share for fourth-quarter 2010, surprisingly outpacing the Zacks Consensus Estimate of $1.25 and also the prior-year quarter’s earnings of $1.04 a share. The increase was primarily attributable to strong top-line growth and good inventory management.
The company’s top line, i.e. net sales went up 5.5% to $1,934.3 million, which was well above the Zacks Consensus Estimate of $1,914.0 million. Moreover, comparable store sales grew 7% to $1,912.0 million compared with $1,794.0 million in the year-ago quarter.
Kohl’s Corporation (KSS), which competes with Dillard’s, reported February stores sales increase of 5%, with total sales climbing 7.1%. Macy’s Inc. (M) also reported a same-store-sales increase of 5.8% for February while total sales jumped 5.9%. Moreover, same store sales of another peer J.C. Penney Company Inc. (JCP) surged 6.4% with total sales rising 2.7% in February, 2011.
The Zacks Consensus Estimate for first-quarter 2011 is 90 cents per share. For full-year 2011, the Zacks Consensus Estimate is $3.12 per share.
Based in Little Rock, Arkansas, Dillard’s Inc. is a large departmental store chain in the United States featuring fashion apparel and home furnishings. The company currently operates 306 stores and 9 clearance centers across 29 states, all under the Dillard’s brand name. Dillard’s stores are mainly located in the Southwest, Southeast and Midwest regions in the US. The company’s primary product categories are: women’s and junior’s apparel; shoes; accessories and lingerie; men’s clothing and accessories; cosmetics; home; and children’s clothing. Its merchandise mix consists of both branded and private-label items.
Dillard’s shares maintain a Zacks #2 Rank, which translates into a short-term ‘Buy’ rating. Our long-term recommendation on the stock remains ‘Outperform’.
DILLARDS INC-A (DDS): Free Stock Analysis Report
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