In the latest trading session, Dollar General (DG - Free Report) closed at $190.03, marking a +0.04% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.65%. Meanwhile, the Dow lost 0.77%, and the Nasdaq, a tech-heavy index, lost 1.27%.
Heading into today, shares of the discount retailer had lost 0.04% over the past month, lagging the Retail-Wholesale sector's gain of 11.47% and the S&P 500's gain of 7.76% in that time.
Investors will be hoping for strength from DG as it approaches its next earnings release. The company is expected to report EPS of $2.33, up 33.91% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $8.15 billion, up 16.72% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $8.88 per share and revenue of $31.95 billion, which would represent changes of +31.95% and +15.11%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for DG. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.36% higher within the past month. DG currently has a Zacks Rank of #2 (Buy).
In terms of valuation, DG is currently trading at a Forward P/E ratio of 21.39. For comparison, its industry has an average Forward P/E of 24.76, which means DG is trading at a discount to the group.
We can also see that DG currently has a PEG ratio of 1.71. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Retail - Discount Stores stocks are, on average, holding a PEG ratio of 4.09 based on yesterday's closing prices.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 63, which puts it in the top 25% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.