By Juveria Tabassum

(Reuters) -Dollar General raised its annual targets after beating estimates for quarterly profit and same-store sales and said more consumers across income groups came in to shop at its stores amid tariff-related uncertainty and still-high inflation.

The forecast lift took the company's shares up 14% on Tuesday and came in sharp contrast to other retailers cutting financial targets and sounding caution on consumer spending due to President Donald Trump's sweeping tariff policies.

The company's core lower-income consumer remains under pressure, but more middle- and higher-income consumers were shopping at its stores than they have had in the last four years, Dollar General Chief Executive Officer Todd Vasos said on a post-earnings call.

Dollar stores have historically stood a better chance to weather out tougher economic conditions as consumers shop for cheaper goods at these outlets to stretch their budgets.

More consumables and other everyday essentials on Dollar General's shelves, and efforts to revamp its stores and merchandise has also helped the company tackle stiff competition from big-box retailers such as Walmart.

"While traffic declines are a bit concerning and the ticket increase may have been boosted by price increases, we think this is Dollar General's best quarter since the early pandemic," Truist Securities analyst Scot Ciccarelli said in a note.

Dollar General's stock has risen about 28% so far during the year as global markets swung between losses and gains in response to the tariffs.

The company now expects annual same-store sales growth at between 1.5% and 2.5%, compared with its prior target of 1.2% to 2.2%. It also raised the low end of its annual earnings per share target by 10 cents to $5.20, keeping the top end unchanged at $5.80.

Dollar General also reduced the amount of its private-label goods it imports from China to about 70% and executives said that the company expects to mitigate most of the impact to its cost of goods from these levies.

The Tennessee-based company's same-store sales for the three months ended May 2 grew 2.4%, topping estimates of a 1.41% rise, according to data compiled by LSEG.

Its first-quarter earnings per share of $1.78 also handily beat Street expectations of $1.48.

Despite the results, Dollar General acknowledged tariff-fueled uncertainty that looms over the rest of the year and said consumer spending could be pressured by tariff-related price increases.

Rival Dollar Tree, which offloaded the Family Dollar chain earlier this year, reports first-quarter results on Wednesday.

(Reporting by Juveria Tabassum in Bengaluru; Editing by Maju Samuel)