Dollar General Corp (DG) (2024)

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Stock XNYS Rating as of

$128.54 −0.99(0.76%)

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Company Report

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Dollar General's Results Likely to Remain Pressured as Low-Income Shoppers Reduce Spending

Noah Rohr

Dollar General’s more than 20,000 small-box locations make the retailer an omnipresent force in rural communities that lack national retail chains. The firm provides low-income households (a typical customer earns around $40,000 per year) with a convenient fill-in shopping destination and reasonable price points on merchandise, which we view as the crux of its value proposition. Since thinly populated and less affluent towns cannot economically support an abundance of retailers, Dollar General thrives by leaning into areas with minimal competition. Furthermore, its impressive scale and proximity to consumers, product mix that is 80% consumables, and small basket size (usually around $15) help insulate the retailer from e-commerce competition.

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DG is trading at a 549% premium.

Price

$128.54

Fair Value

$886.00

Uncertainty

Medium

1-Star Price
$642.28

5-Star Price
$656.70

Economic Moat
Tsjsyx

Capital Allocation
Vqmmmjdy

Bulls Say, Bears Say

Bulls

Dollar General is insulated from intense retail competition by its positioning in thinly populated rural towns, which are largely unattractive for most competing retail banners.

Bears

The dollar store footprint looks crowded today—Dollar General, Dollar Tree, and Family Dollar account for over 37,000 storefronts—which could weigh on opportunities to drive growth via store expansion.

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News

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  • Dollar General Announces New Dolly Parton Kitchen and Housewares Collection in Stores Nationwide
  • Dollar General Extends American Red Cross Partnership
  • Dollar General Selects Criteo to Enhance its Retail Media Offering
  • Dollar General sees more people in its stores, but they are buying less
  • Dollar General Corporation Reports First Quarter 2024 Results
  • Some buzzy AI names highlight this week's earnings slate - along with Costco
  • Dollar General Literacy Foundation Awards More Than $10.6 Million
  • Dollar General Corporation Announces Webcast of its First Quarter 2024 Earnings Conference Call

Trading Information

Previous Close Price
$129.53
Day Range

$127.26129.47

52-Week Range

$101.09173.47

Bid/Ask
$127.07/$129.69

Market Cap
$28.27 Bil

Volume/Avg
1.6 Mil/2.5 Mil

Key Statistics

Price/Earnings (Normalized)
18.71

Price/Sales
0.72

Dividend Yield (Trailing)
1.84%

Dividend Yield (Forward)
1.84%

Total Yield
1.84%

Company Profile

With over 20,000 locations, Dollar General’s banner is nearly ubiquitous across the rural United States. Dollar General serves as a convenient shopping destination for fill-in store trips, with its value proposition most relevant to consumers in small communities with a dearth of shopping options. The retailer operates a frugal store of about 7,500 square feet and primarily offers an assortment of branded and private-label consumable items (80% of net sales) such as paper and cleaning products, packaged and perishable food, tobacco, and health and beauty items at low prices. Dollar General also offers a limited assortment of seasonal merchandise, home products, and apparel. The firm sells most items at a price point of $10 or less.

Sector
Consumer Defensive

Industry
Discount Stores

Stock Style Box
Mid Value

Total Number of Employees
170,000

Competitors

  • Dollar Tree Inc DLTR
  • Target Corp TGT
  • Walmart Inc WMT

Valuation

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Metric

DG

DLTR

TGT

Price/Earnings (Normalized)

18.7117.7516.57

Price/Book Value

4.033.104.93

Price/Sales

0.720.740.64

Price/Cash Flow

11.049.918.99

Price/Earnings

DG

DLTR

TGT

Financial Strength

Metric

DG

DLTR

TGT

Quick Ratio

0.110.130.18

Current Ratio

1.221.280.86

Interest Coverage

7.12−8.3712.52

Quick Ratio

DG

DLTR

TGT

Profitability

Metric

DG

DLTR

TGT

Return on Assets (Normalized)

5.07%5.58%7.99%

Return on Equity (Normalized)

23.87%15.40%34.30%

Return on Invested Capital (Normalized)

7.31%7.29%14.78%

Return on Assets

DG

DLTR

TGT

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Walmart Inc

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Dollar General Corp (DG) (2024)

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