Wall Street Sees a 21% Upside to Dollar General (DG)

Core Viewpoint - Dollar General Corporation (NYSE:DG) is viewed positively by investors, with a potential upside of 21% according to market analysts, despite a minimal downside of 0.11% based on average price targets [1]. Financial Performance - Dollar General reported Q3 sales of $10.65 billion, reflecting a 2.5% increase, which aligns with market expectations [2]. - The company's earnings per share (EPS) of $1.28 exceeded Truist's estimate of $0.96, indicating stronger profitability than anticipated [2]. Growth Drivers - The increase in earnings is attributed to reduced shrinkage, larger markups, and a modest boost from hurricane-related buying [3]. - Sales growth has returned to a 2-3% pace after facing challenges in 2023 and 2024 [3]. Margin Improvement - Improved margins this year are a result of diminished inventory, SKU optimization initiatives, and lower shrinkage [4]. - Despite the positive financial results, Truist maintains a Hold recommendation due to anticipated tough margin comparisons in the upcoming year [4].