Ninety-nine Cents Only Stores Earnings Cheat Sheet: Powering Ahead

99 Cents Only Stores (NYSE:NDN) reported its results for the second quarter. Ninety-nine Cents Only Stores’ main business is the sale of various consumer products through its retail stores at price points of mainly 99 cents or less.

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99 Cents Only Stores Earnings Cheat Sheet for the Second Quarter

Results: Net income for 99 Cents Only Stores rose to $15.1 million (21 cents per share) vs. $12.9 million (18 cents per share) in the same quarter a year earlier. This marks a rise of 16.8% from the year earlier quarter.

Revenue: Rose 8.8% to $363 million from the year earlier quarter.

Actual vs. Wall St. Expectations: NDN fell short of the mean analyst estimate of 22 cents per share. Analysts were expecting revenue of $358.6 million.

Quoting Management: Eric Schiffer, CEO of 99 Cents Only Stores, stated, “We are pleased with our financial results for the second quarter of fiscal 2012. Our long-term operational improvement initiatives have continued to meet our expectations, resulting in earnings per share of $0.21 for the second quarter of fiscal 2012. We look forward to further discussing our results on today’s earnings release conference call.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the first quarter, net income rose 5.2% and in the fourth quarter of the last fiscal year, the figure rose 6.3%.

Gross margin shrank 0.6 percentage point to 40.2%. The contraction appeared to be driven by increased costs, which rose 10% from the year earlier quarter while revenue rose 8.8%.

Revenue has risen the past four quarters. Revenue increased 6.3% to $368.3 million in the first quarter. The figure rose 11.6% in the fourth quarter of the last fiscal year from the year earlier and climbed 1.7% in the third quarter of the last fiscal year from the year-ago quarter.

The company has now fallen short of analyst estimates for the last three quarters. It missed the mark by 2 cents in the first quarter and by 2 cents in the fourth quarter of the last fiscal year.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the third quarter is 40 cents per share, down from 41 cents ninety days ago. In the last thirty days, the average estimate for the fiscal year has moved up from $1.12 per share to $1.15.

Competitors to Watch: Dollar General Corp. (NYSE:DG), Family Dollar Stores, Inc. (NYSE:FDO), Dollar Tree, Inc. (NASDAQ:DLTR), Big Lots, Inc. (NYSE:BIG), Target Corporation (NYSE:TGT), Fred’s, Inc. (NASDAQ:FRED), Costco Wholesale Corp. (NASDAQ:COST), Wal-Mart Stores, Inc. (NYSE:WMT), Gordmans Stores, Inc. (NASDAQ:GMAN).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)