One of the big retail beneficiaries of the health crisis is signaling a slowdown. Dollar General indicated Thursday the return to normalcy would cause same-store sales to decline 4% to 6% for the full year. That’s a lot steeper than analysts expected.
The chain also forecast annual sales and profit that fell short of Wall Streets’ targets. Analysts see sales at discount stores dropping in the latter half of the year as more Americans get vaccinated and the economy reopens.
That’s a sharp contrast to last year. Dollar General benefited from the health crisis as consumers stocked their pantries to hunker down at home. High unemployment and shrinking incomes boosted demand for lower-priced groceries and household goods, lifting sales at dollar stores. Even in the latest quarter, profit soared 20% as same-store sales jumped nearly 13%.
The company’s shares, which have risen 17% over the last 12 months, fell in early trading Thursday.