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Player Avatar TMF1000 (99.68) Submitted: 9/9/2011 2:32:12 PM : Outperform Start Price: $47.86 FDO Score: -9.70

CAP price entered at $50.29. This gives them a PE ratio of 16.65. A cash flow yield of 3.6% and a dividend yield of 1.43%
Dow 10,987.29: SP500 1,154.24
Gold 1859.5
Silver 41.70
Copper 3.99
Oil $87.14

As the markets fall, FDO should stabilize faster than other retailers as more shoppers look for bargains in convenient locations. The last recession was very good for FDO and the fear that we may slide into another should help their stock price. Dividend yield is 1.43% which isn't bad.

March 30, 2011 2Q:2011 earnings’ highlights:
** Revenues were $2.263 billion up 8.3% from $2.09 billion
** TTM revenues were $8.02 billion or $65.34 per share
** Earnings were $0.98 up from $0.81
** TTM earnings were $2.88
** Diluted share count 125.701 million
** annual dividend $0.72
** Cash $581 million: Debt $549 million
** Cash flow for six months $85.9 million down from $234 million
** Cash flow for the quarter was $164.9 million down from $274.1 million
** TTM cash flow was $232.3 million or $1.85 per share
** Capital expenditures for the six months was $139 million up from $82.9 million
** Capital expenditures for the quarter was $99.86 million up from $43.76 million
** Same stores sales were up 5.1%
** Trading range between March 30 2011 and July 29, 2011 was $51.12 to $56.92: PE ratio range was 17.75 to 19.76: Cash flow yield range was 3.3% to 3.6%: Dividend yield range was 1.3% to 1.4%

July 29, 2011 3Q:2011 earnings’ highlights:
** Revenues were $2.153 billion up from $1.997 billion last year
** TTM revenues were $8.176 billion or $66.66 per share
** Earnings per share $0.91 up from $0.77
** TTM earnings were $3.02
** Diluted share count 122.656 million
** Annual dividends were $0.72
** Cash and investments $465.2 million: Debt Debt $548.5 million
** Cash flow for the nine months $77.2 million down from $238 million
** Cash flow for the quarter was negative ($8.7 million) down from cash flow of $4 million last year
** TTM cash flow was $219.6 million or $1.79 per share
** Trading range between July 29, 2011 and the present September 9, 2011 was $44.42 to $54.38: PE ratio range was 14.71 to 18: PS ratio range was .67 to .82: Cash flow yield range was 3.3% to 4%: Dividend ratio range was 1.3% to 1.6%

Report this Post 2 Replies
Member Avatar Mliaom (49.95) Submitted: 9/9/2011 3:21:27 PM
Recs: 1

How do you feel about their high debt to cash and negative cash flow for the quarter?

Member Avatar TMF1000 (99.68) Submitted: 9/12/2011 10:17:16 AM
Recs: 1

Hi Mliaom,

No it doesn't concern me because they tend to have a few cash flow negative quarters each year, but they are able to report good annual cash flow. During bad times, they even seem to do better. So I don't consider it a problem. Wal-mart express is Wal-mart's answer to the dollar store threat. That seems to be the biggest obstacle for them presently.

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