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Dollar General Announces Secondary Offering, Insiders Identified

October 06, 2012 | About:
Four Dollar General (DG) insider sells were reported Wednesday, 10/02/2012, according to GuruFocus Insider Data, in congruence to the discount retailer’s secondary share offering released 09/27/2012.

The four insiders were identified as the following: Dollar General Chairman and CEO, Richard Dreiling, who sold more than $6.2 million worth of shares; Executive Vice President and CFO, David Tehle, who sold more than $1.7 million worth of shares; Executive Vice President and General Counsel Susan Lanigan, who sold almost $1.2 million worth of shares; and lastly, Senior Vice President and Controller, Anita Elliot, who sole almost $520,000 worth of shares.

Stakes were sold at $51.75 per share.

The secondary offering, which closed one day after the insider trades occurred, consisted of 36 million common shares for the public, and granted the offering’s underwriters an option to purchase up to 5.4 million additional shares.

Citigroup (C), Goldman, Sachs & Co. (GS) and Kohlberg Kravis Roberts & Co. (KKR) served as the joint book running managers of the offering.

Earlier last month, Dollar General reported strong second quarter results.

Compared to last year`s second quarter, Dollar General`s sales increased 10.4 percent by the end of this year’s second quarter. The company’s adjusted net income increased by 27 percent and reflectively, its adjusted earnings per share increased by 33 percent based off of the previous year’s second quarter comparison.

“We are pleased with the start of our third quarter and have refined our expectation for full year same-stores sales growth to 4 to 5 percent, an increase from our previous expectation of 3 to 5 percent…” Dreiling said in a Dollar General press release. “We are well-positioned to continue to broaden our appeal to more customers and to provide them with convenience and everyday low prices they can depend on.”

The most significant factors that affected Dollar General’s positive gross profit rate in this year’s second quarter included higher initial inventory markups, transportation efficiencies coupled with lower fuel cost and the impact of a significant last-in-first-out charge in the 2011 period, according to the release.

Dollar General Corp. is a retailer known for its discounted nationally-branded items at more than 10,000 stores nationwide, selling consumers products such as food, cleaning supplies, basic apparel, seasonal products and beauty aids.

Currently selling at $51.75 per share, Dollar General has a market cap of $17.13 billion, a P/E ratio of 19.5 and a P/S ratio of 1.2.

About GuruFocus Insider Data

In 2010, GuruFocus held a three-part Insider Research series examining the relevance of Insider trading activity within companies. The research revealed many interesting facts about incorporating the gathered information to personal investment strategies, as it contributed to the development in the Insider tracking and alert tools offered on GuruFocus. You can view the three-part research series by visiting the following links:

Guru Insider Research (I): The Summary of Previous Research Results

Guru Insider Research (II): Can Aggregated Insider Trading Activities Predict the Market?

Guru Insider Research (III): Can Aggregated Insider Trading Activities Predict the Market of Different Sectors?

About the author:

Dianne Tordillo
Dianne Tordillo is staff writer for GuruFocus.com. She reports on a variety of financial news, primarily dealing with investor portfolios and stock trades. Her articles also highlight insider trades, as well as the many useful features of GuruFocus.

Visit Dianne Tordillo's Website


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