Dollar General (NYSE:DG) Shares Gap Up - Still a Buy?

Key Points

• Dollar General shares jumped at the open, gapping from $104.33 to $111.00 before last trading around $110.34 as investors digested the latest news flow ahead of earnings.
• Analysts are mixed: Rothschild & Co Redburn kept a Sell rating and $90 target while other firms such as Wolfe Research and Guggenheim remain more constructive, leaving the consensus at Hold with a $139.96 target.
• Sentiment is being shaped by expectations for the June 2 earnings report, with UBS saying Dollar General could meet the market’s bar for about 2% comparable sales growth and investors watching for evidence of sustained sales and margin improvement.

Dollar General Corporation (NYSE:DG - Get Free Report) gapped up prior to trading on Thursday . The stock had previously closed at $104.33, but opened at $111.00. Dollar General shares last traded at $110.34, with a volume of 935,523 shares changing hands.

More Dollar General News

Here are the key news stories impacting Dollar General this week:

• Positive Sentiment: Rothschild & Co Redburn raised several longer-dated EPS estimates for Dollar General, including FY2027 to $7.12 from $7.01, FY2028 to $7.16 from $6.91, FY2029 to $7.38 from $6.92, and Q4 2028 to $2.01 from $1.77, signaling slightly better profit expectations over time.
• Positive Sentiment: The firm also lifted its Q1 2029 estimate to $1.93 from $1.88, suggesting some improvement in the company’s longer-term earnings trajectory.
• Neutral Sentiment: UBS said Dollar General is likely to meet the market’s bar for about 2% comparable sales growth in Q1, which supports expectations heading into the report but does not indicate a major upside surprise.
• Neutral Sentiment: Dollar General is also facing a shareholder vote on a human-rights policy proposal and is in the middle of a CEO transition plan, both of which add governance overhang but do not directly change near-term earnings power.
• Negative Sentiment: Rothschild & Co Redburn kept a Sell rating and a $90 price target, and also trimmed some near-term estimates, including Q1 2027 to $1.88 from $1.91, Q2 2027 to $1.97 from $1.98, Q3 2027 to $1.33 from $1.36, and Q1 2028 to $1.86 from $1.87.
• Negative Sentiment: The stock is also being weighed by risk reduction ahead of the June 2 earnings release, with investors apparently waiting for clearer evidence that Dollar General can sustain sales and margin improvement.

Analyst Upgrades and Downgrades

DG has been the topic of a number of recent research reports. Rothschild & Co Redburn dropped their target price on Dollar General from $111.00 to $90.00 and set a "sell" rating on the stock in a research report on Monday, May 18th. Wolfe Research reiterated an "outperform" rating and issued a $165.00 target price on shares of Dollar General in a research report on Thursday, March 12th. Wall Street Zen lowered Dollar General from a "buy" rating to a "hold" rating in a research report on Saturday, April 4th. Loop Capital decreased their price target on Dollar General from $145.00 to $110.00 and set a "hold" rating for the company in a report on Friday, May 22nd. Finally, Guggenheim decreased their price target on Dollar General from $165.00 to $160.00 and set a "buy" rating for the company in a report on Friday, March 13th. Twelve equities research analysts have rated the stock with a Buy rating, sixteen have assigned a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat.com, Dollar General presently has a consensus rating of "Hold" and a consensus target price of $139.96.

Dollar General Price Performance

The company has a market capitalization of $24.36 billion, a price-to-earnings ratio of 16.11, a P/E/G ratio of 1.68 and a beta of 0.28. The stock has a fifty day simple moving average of $116.22 and a 200-day simple moving average of $128.53. The company has a debt-to-equity ratio of 0.54, a current ratio of 1.13 and a quick ratio of 0.22.

Dollar General (NYSE:DG - Get Free Report) last announced its quarterly earnings results on Thursday, March 12th. The company reported $1.93 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.57 by $0.36. Dollar General had a return on equity of 18.66% and a net margin of 3.54%.The company had revenue of $10.91 billion during the quarter, compared to the consensus estimate of $10.78 billion. During the same period in the previous year, the company posted $0.87 earnings per share. Dollar General's revenue for the quarter was up 5.9% on a year-over-year basis. Dollar General has set its FY 2026 guidance at 7.100-7.35 EPS. On average, equities research analysts anticipate that Dollar General Corporation will post 7.27 EPS for the current year.

Dollar General Dividend Announcement

The firm also recently announced a quarterly dividend, which was paid on Tuesday, April 21st. Stockholders of record on Tuesday, April 7th were paid a dividend of $0.59 per share. This represents a $2.36 annualized dividend and a dividend yield of 2.1%. The ex-dividend date of this dividend was Tuesday, April 7th. Dollar General's dividend payout ratio is presently 34.45%.

Institutional Inflows and Outflows

Several large investors have recently made changes to their positions in DG. Fideuram Asset Management Ireland dac acquired a new position in shares of Dollar General during the 4th quarter worth approximately $25,000. Caitong International Asset Management Co. Ltd raised its stake in shares of Dollar General by 4,550.0% during the 4th quarter. Caitong International Asset Management Co. Ltd now owns 186 shares of the company's stock worth $25,000 after buying an additional 182 shares during the period. Evergreen Advisors LLC acquired a new position in shares of Dollar General during the 1st quarter worth approximately $25,000. Root Financial Partners LLC acquired a new position in shares of Dollar General during the 3rd quarter worth approximately $26,000. Finally, Annis Gardner Whiting Capital Advisors LLC raised its stake in shares of Dollar General by 69.3% during the 4th quarter. Annis Gardner Whiting Capital Advisors LLC now owns 193 shares of the company's stock worth $26,000 after buying an additional 79 shares during the period. 91.77% of the stock is owned by institutional investors and hedge funds.

Dollar General Company Profile

Dollar General Corporation is a U.S.-based variety and discount retailer operating a large network of small-format stores that serve primarily rural and suburban communities. The company is publicly traded on the New York Stock Exchange under the ticker DG and is headquartered in the Nashville/Goodlettsville, Tennessee area. Founded in 1939, Dollar General has grown from a regional operation into one of the nation's prominent low-price retailers focused on convenience and value.

Dollar General's stores offer a wide assortment of everyday consumables and household goods, including food and beverage items, cleaning supplies, health and beauty products, paper goods, apparel basics, seasonal merchandise and small household items.

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