An investor in NYSE:DG shares filed a lawsuit over alleged violations of Federal Securities Laws by Dollar General Corp.
Investors who purchased shares of Dollar General Corp. (NYSE:DG) have certain options and for certain investors are short and strict deadlines running. Deadline: March 20, 2017. NYSE:DG investors should contact the Shareholders Foundation at firstname.lastname@example.org or call +1(858) 779 – 1554.
The plaintiff claims that between March 10, 2016 and November 30, 2016 the defendants made false and/or misleading statements and/or failed to disclose that the announced limitations on Supplemental Nutrition Assistance Program (“SNAP”) benefits would have a material impact on the Company’s financial performance because 56% of Dollar General’s stores are located in states that re-implemented time limitations on SNAP benefits in 2016, and therefore the impact of SNAP reductions would be disproportionate to the percentage of the Company’s overall sales comprised of SNAP payments.
The plaintiff says that these statements were material to investors because they were made in response to concerns by analysts that SNAP benefits were going to be reduced in a number of states – which potentially would have impacted Dollar General’s sales to the extent its business operations were exposed to SNAP changes.
Dollar General Corp. reported that its Total Revenue rose from over $18.9 billion for the 52 weeks period that ended on January 30, 2015 to over $20.36 billion for the 52 weeks period that ended on January 29, 2016 and that its Net Income for those time periods increased from over $1.06 billion to over $1.16 billion.
Shares of Dollar General Corp. (NYSE:DG) grew from $60.02 per share in November 2015 to as high as $95.15 per share in July 2016.
The plaintiff claims that the truth about the impact that SNAP reductions were having on Dollar General Corp’s business began to surface on August 25, 2016, when Dollar General Corp announced disappointing second quarter 2016 financial and operational results.
On December 1, 2016, Dollar General Corp. reported its financial results for its fiscal 2016 third quarter ended October 28, 2016.
The plaintiff alleges that previously predicted annual same-store sales growth of 2-4%, and most analysts expected a quarterly increase in same-store sales of nearly 1%, but reported a reduction in same-store sales in its financial results for its fiscal 2016 third quarter ended October 28, 2016.
The plaintiff says that Dollar General Corp again attributed its poor quarterly performance, in large part, to reductions in SNAP benefits, and finally admitted the true impact that SNAP reductions were having on its sales, stating that the benefit reductions “affect about 56% of our store base . . . And those states that have had the reduction or elimination, they are approximately 100-basis-point worse in comp. That gives you a real good idea of how impactful those SNAP benefits reductions have been.”
On January 30, 2017, NYSE:DG shares closed at $72.00 per share.
Those who purchased NYSE:DG shares have certain options and should contact the Shareholders Foundation.
Shareholders Foundation, Inc.
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