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Bear of the Day: Dollar General (DG)

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With the market unwinding, there are plenty of stocks that are coming under pressure. Selling is hitting many industries. There are some stocks out there which are more vulnerable than others. The most vulnerable stocks are those with the weakest earnings trends. One way to uncover this weakness is by checking out our Zacks Rank. Stocks which are lower Zacks Ranks have the weakest trends.

One such stock is today’s Bear of the Day, Dollar General ((DG - Free Report) ). Dollar General Corporation, a discount retailer, provides various merchandise products in the southern, southwestern, midwestern, and eastern United States. It offers consumable products, including paper and cleaning products, such as paper towels, bath tissues, paper dinnerware, trash and storage bags, disinfectants, and laundry products; packaged food comprising cereals, pasta, canned soups, fruits and vegetables, condiments, spices, sugar, and flour; and perishables that include milk, eggs, bread, refrigerated and frozen food, beer, and wine.

Dollar General is currently a Zacks Rank #5 (Strong Sell). The reason for the unfavorable rank is several analysts have cut their estimates. Over the last week, 13 analysts have cut their estimates for the current year while 12 have done so for next year. The bearish activity has dropped our Zacks Consensus Estimates for the current year from $10.08 to $8.82 while next year’s is off from $10.97 to $9.64. The most recent earnings report coming in 36 cents shy of expectations is a big reason why.

Zacks Investment Research
Image Source: Zacks Investment Research

The Retail – Discount Stores industry ranks in the Bottom 32% of our Zacks Industry Rank. There is only one stock in that industry which has a favorable Zacks Rank. That’s Zacks Rank #2 (Buy) Ross Stores ((ROST - Free Report) ). Several stocks are Zacks Rank #3 (Hold) stocks including Big Lots ((BIG - Free Report) ).

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