Loop Capital has revised its price target for Dollar General (DG, Financial), increasing it from $110 to $120, while maintaining a Hold rating on the stock. This update comes as the firm observes notable improvements in store-level execution. Based on a tracker that assesses store qualities such as cleanliness, stock levels, and staff engagement in locations across downtown Chicago and the suburbs of Manhattan, it is evident that these enhancements are largely attributable to increased staffing hours and a stronger focus on customer service.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 25 analysts, the average target price for Dollar General Corp (DG, Financial) is $116.06 with a high estimate of $135.00 and a low estimate of $80.00. The average target implies an upside of 3.30% from the current price of $112.35. More detailed estimate data can be found on the Dollar General Corp (DG) Forecast page.
Based on the consensus recommendation from 30 brokerage firms, Dollar General Corp's (DG, Financial) average brokerage recommendation is currently 2.4, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Dollar General Corp (DG, Financial) in one year is $153.08, suggesting a upside of 36.25% from the current price of $112.35. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Dollar General Corp (DG) Summary page.
DG Key Business Developments
Release Date: June 03, 2025
- Net Sales: Increased 5.3% to $10.4 billion in Q1.
- New Store Openings: 156 new stores opened during the quarter.
- Same-Store Sales: Increased 2.4% during the quarter.
- Gross Profit Margin: 31%, an increase of 78 basis points.
- Operating Profit: Increased 5.5% to $576 million.
- EPS: Increased 7.9% to $1.78.
- Cash Flow from Operations: $847 million, an increase of 27.6%.
- Merchandise Inventories: $6.6 billion, a decrease of 5% compared to prior year.
- Dividend Payment: $0.59 per common share, totaling $130 million.
- 2025 Financial Guidance: Net sales growth of 3.7% to 4.7%, same-store sales growth of 1.5% to 2.5%, EPS range of $5.20 to $5.80.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Dollar General Corp (DG, Financial) reported a 5.3% increase in net sales to $10.4 billion in Q1 2025, driven by the opening of 156 new stores.
- Same-store sales increased by 2.4%, with growth in both consumable and non-consumable product categories.
- The company achieved a gross profit margin increase of 78 basis points, attributed to lower shrink and higher inventory markups.
- Dollar General Corp (DG) saw a 7.9% increase in EPS to $1.78, exceeding internal expectations.
- The company reported strong cash flow from operations, increasing by 27.6% to $847 million, and reduced merchandise inventories by 5%.
Negative Points
- Customer traffic slightly decreased by 0.3% during the quarter, despite strong sales growth.
- SG&A expenses increased by 77 basis points as a percentage of sales, driven by higher retail labor and incentive compensation costs.
- The company faces uncertainty due to the evolving tariff environment, which could impact consumer spending and cost of goods.
- Dollar General Corp (DG) anticipates a significant headwind from incentive compensation expenses, particularly impacting Q2.
- The cost to build new stores has risen by more than 40% since 2019, impacting the company's return on investment for new store openings.
