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Dollar General (DG) Stock Sinks As Market Gains: What You Should Know

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Dollar General (DG - Free Report) closed at $247.72 in the latest trading session, marking a -0.04% move from the prior day. This change lagged the S&P 500's 0.13% gain on the day. At the same time, the Dow added 0.28%, and the tech-heavy Nasdaq lost 0.04%.

Prior to today's trading, shares of the discount retailer had lost 0.04% over the past month. This has lagged the Retail-Wholesale sector's gain of 8.19% and the S&P 500's gain of 5.55% in that time.

Dollar General will be looking to display strength as it nears its next earnings release. On that day, Dollar General is projected to report earnings of $2.90 per share, which would represent year-over-year growth of 7.81%. Our most recent consensus estimate is calling for quarterly revenue of $9.35 billion, up 8.12% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $11.49 per share and revenue of $37.59 billion. These totals would mark changes of +12.98% and +9.84%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Dollar General. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.13% higher. Dollar General is holding a Zacks Rank of #2 (Buy) right now.

In terms of valuation, Dollar General is currently trading at a Forward P/E ratio of 21.57. This represents a premium compared to its industry's average Forward P/E of 21.11.

Meanwhile, DG's PEG ratio is currently 1.77. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Retail - Discount Stores industry currently had an average PEG ratio of 1.79 as of yesterday's close.

The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 156, which puts it in the bottom 39% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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