Dillard's, Inc. (DDS) | Investment Case

1. Company Snapshot

1.a. Company Description

Dillard's, Inc.operates retail department stores in the southeastern, southwestern, and midwestern areas of the United States.Its stores offer merchandise, including fashion apparel for women, men, and children; and accessories, cosmetics, home furnishings, and other consumer goods.

As of January 29, 2022, the company operated 280 Dillard's stores, including 30 clearance centers, and an Internet store at dillards.com.It also engages in the general contracting construction activities.The company was founded in 1938 and is based in Little Rock, Arkansas.

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1.b. Last Insights on DDS

Dillard's recent performance was driven by solid Q3 sales, margin gains, and strategic execution, signaling strong investor confidence. The company's comparable store sales rose 3%, and sales increased 2.9%, beating estimates. Dillard's also delivered a Q3 earnings beat, with quarterly earnings of $8.31 per share, surpassing the Zacks Consensus Estimate of $6.43 per share. Additionally, the company's stock buybacks are turbocharging shareholders' gains, and its solid sales and margin expansion are driving profits higher.

1.c. Company Highlights

Last Price	634.51
Change Percentage	-2.10%
Open	637.42
Previous Close	648.12
Market Cap ( Millions)	9907
Volume	186259
Year High	741.98
Year Low	282.24
M A 50	656.37
M A 200	541.21

FCF Yield	7.85%
Dividend Yield	4.90%
ROE	30.50%
Debt / Equity	26.83%
Net Debt / EBIDTA	-64.81%
Price To Book	4.84
Price Earnings Ratio	17.04
Price To FCF	12.73
Price To sales	1.5
EV / EBITDA	10.04

2. Transcript Summary

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3. NewsRoom

Is Dillard's (DDS) Stock Outpacing Its Retail-Wholesale Peers This Year?

Feb -04

Source: zacks.com

Dillard’s (NYSE:DDS) Share Price Crosses Above 200-Day Moving Average – Here’s What Happened

Feb -03

Source: defenseworld.net

3 No-Brainer Dividend Stocks to Buy Right Now

Jan -17

Source: fool.com

Caterpillar is potential winner if data centers move power generation on-site: Bernstein's Dillard

Jan -16

Source: youtube.com

Fashion Wins at Dillard's: Will Category Gains Be Sustainable?

Jan -14

Source: zacks.com

Is Dillard's (DDS) Outperforming Other Retail-Wholesale Stocks This Year?

Jan -14

Source: zacks.com

Dillard’s, Inc. (NYSE:DDS) Given Average Rating of “Hold” by Analysts

Jan -11

Source: defenseworld.net

Is Dillard's Digital Growth Enough to Offset Store Traffic Slump?

Jan -02

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.87%)

6. Segments

Retail

Expected Growth: 3.83%

Dillard's, Inc. retail segment growth of 3.83% is driven by effective inventory management, strategic pricing, and a strong omnichannel presence. Additionally, the company's focus on private brands, such as Antonio Melani and Gianni Bini, has contributed to increased sales. Furthermore, Dillard's has successfully implemented cost-saving initiatives, which have positively impacted profitability.

Construction

Expected Growth: 4.83%

Dillard's Inc.'s construction segment growth of 4.83% is driven by increasing demand for commercial and residential building projects, fueled by low interest rates and government infrastructure investments. Additionally, the company's focus on omnichannel retailing and strategic store remodels have enhanced customer experience, leading to higher sales and revenue growth.

7. Detailed Products

Women's Apparel

Dillard's offers a wide range of women's clothing, including dresses, tops, pants, and outerwear from popular brands like Antonio Melani, Gianni Bini, and more.

Men's Apparel

Dillard's provides a variety of men's clothing, including dress shirts, pants, jeans, and outerwear from brands like Izod, Levi's, and more.

Children's Apparel

Dillard's offers a range of clothing for kids, including casual wear, dressy outfits, and outerwear from brands like Carter's, OshKosh, and more.

Shoes

Dillard's sells a wide selection of shoes for men, women, and kids, including boots, sandals, sneakers, and dress shoes from brands like Nike, UGG, and more.

Handbags and Accessories

Dillard's offers a variety of handbags, wallets, scarves, hats, and other accessories from brands like Coach, Michael Kors, and more.

Home and Furniture

Dillard's sells a range of home goods, including bedding, kitchenware, and furniture from brands like KitchenAid, Lenox, and more.

Beauty and Fragrances

Dillard's offers a variety of beauty products, fragrances, and skincare items from brands like Estee Lauder, Clinique, and more.

8. Dillard's, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Dillard's, Inc. faces moderate threat from substitutes, as customers have alternative options for purchasing apparel and home goods, such as online retailers and specialty stores.

Bargaining Power Of Customers

Dillard's, Inc. faces high bargaining power from customers, as they have many options for purchasing apparel and home goods, and can easily switch to competitors if prices are not competitive.

Bargaining Power Of Suppliers

Dillard's, Inc. has a relatively low bargaining power of suppliers, as it is a large retailer with significant purchasing power, allowing it to negotiate favorable prices with suppliers.

Threat Of New Entrants

Dillard's, Inc. faces a low threat of new entrants, as entering the retail industry requires significant capital investment and establishing a strong brand presence, which can be a barrier to entry.

Intensity Of Rivalry

Dillard's, Inc. operates in a highly competitive retail industry, with many established players, which leads to a high intensity of rivalry among competitors.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	23.89%
Debt Cost	8.93%
Equity Weight	76.11%
Equity Cost	9.04%
WACC	9.01%
Leverage	31.39%

11. Quality Control: Dillard's, Inc. passed 8 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Dillard's

A-Score: 6.9/10

Value: 5.2

Growth: 6.9

Quality: 7.1

Yield: 9.0

Momentum: 8.5

Volatility: 5.0

1-Year Total Return ->

H&R Block

A-Score: 6.3/10

Value: 7.8

Growth: 6.0

Quality: 6.7

Yield: 7.0

Momentum: 1.5

Volatility: 8.7

1-Year Total Return ->

Macy's

A-Score: 5.4/10

Value: 7.8

Growth: 2.6

Quality: 4.4

Yield: 7.0

Momentum: 7.5

Volatility: 3.0

1-Year Total Return ->

Nordstrom

A-Score: 5.2/10

Value: 7.4

Growth: 3.8

Quality: 4.2

Yield: 4.0

Momentum: 7.0

Volatility: 5.0

1-Year Total Return ->

KB Home

A-Score: 4.9/10

Value: 7.8

Growth: 4.6

Quality: 5.3

Yield: 3.0

Momentum: 2.5

Volatility: 6.0

1-Year Total Return ->

Kohls

A-Score: 4.8/10

Value: 8.9

Growth: 2.4

Quality: 3.4

Yield: 7.0

Momentum: 6.0

Volatility: 1.3

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

1.40%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

9.01%

Dillard's, Inc. - US2540671011

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on DDS

1.c. Company Highlights

Higher Yield

Higher Growth

Better Quality

Earnings Beats

Revenues Beats

Earnings Miss

Revenues Miss

Average Growth

Stable Momentum

Strong Momentum

2. Transcript Summary

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.87%)

6. Segments

Retail

Expected Growth: 3.83%

Construction

Expected Growth: 4.83%

7. Detailed Products

Women's Apparel

Men's Apparel

Children's Apparel

Shoes

Handbags and Accessories

Home and Furniture

Beauty and Fragrances

8. Dillard's, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: Dillard's, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

634.51$

Current Price

634.51$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA