Investors sent shares in Dollar General higher Thursday after the company announced better-than-expected sales growth and plans to open 900 stores in 2018.
Why it matters: Dollar General avoided the struggles of the broader retail industry by focusing on poor, rural communities overlooked by Walmart, which are home to customers living paycheck-to-paycheck with limited access to credit cards.
But the planned expansion is in part a bid to go after affluent shoppers. "We are encouraged by the early progress," Neil Saunders, managing director of GlobalData Retail, said in a research note to clients. "The company is capturing a more significant share of spending from middle income and more affluent Americans."
Dollar General credited its strong 4.3% same-store sales growth on its success bringing in these type of shoppers, who are able to spend more per visit.
