Growing Through Challenges? – Dollar General Corporation (DG)

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SSgA Funds Management, Inc. recently announced the acquisition of new stake in Dollar General Corporation (NYSE:DG). The institutional investor has increased its shareholding in the Consumer Defensive company by 0.40% to 11.39 million shares with purchase of 45463.0 shares. This fresh investment now brings its stake to 4.53% valued currently at $2.17 billion. In addition, Capital Research & Management Co. raised its holdings by 6.18 million to 11.08 million shares.

With over 0.97 million Dollar General Corporation (DG) shares trading Wednesday and a closing price of $191.46 on the day, the dollar volume was approximately $186.19 million. The shares have shown a negative weekly performance of -0.95% and its price on 07/28/20 gained nearly 0.75%. Currently, there are 251.78M common shares owned by the public and among those 251.21M shares have been available to trade.

An analysis of what Wall Street brokers have to say about the expected price targets for this stock gives us this picture: 28 analysts who have offered their price forecasts for DG have a consensus price objective of $205.88. The analysts have set the share’s price value over the next 12 months at a high of $225.00 and a low of $142.00 should the stock experience a downside. Incidentally, analysts’ outlook for the Dollar General Corporation stock is 2.00 for the next 12 months. The average price target is 6.23% above its last price level and an upside to the estimated low will see the stock lose -34.83% over that period. But an upside of 14.91% will see the stock hit the forecast high price target while mean target price for the stock is $210.00.

Insiders at the company have transacted a total of 71 times over the past 12 months, according to data filed with the U.S. Securities and Exchange Commission (SEC). 43 of these insider trades were purchases, accounting for 389,552 shares. Insider sales of the common stock occurred on 28 occasions, with total insider shares sold totaling 336,685 shares.

The top 3 mutual fund holders in Dollar General Corporation are Vanguard Total Stock Market Index, Vanguard 500 Index Fund, and T Rowe Price Blue Chip Growth Fun. Vanguard Total Stock Market Index owns 7.17 million shares of the company’s stock, all valued at over $1.37 billion. The company sold -0.24 million shares recently to bring their total holdings to about 2.85% of the shares outstanding. Vanguard 500 Index Fund bought 22879.0 shares to see its total holdings expand to 5.22 million shares valued at over $994.93 million and representing 2.08% of the shares outstanding. T Rowe Price Blue Chip Growth Fun sold 19914.0 shares to bring its total holdings to over 5.07 million shares at a value of $966.76 million. T Rowe Price Blue Chip Growth Fun now owns shares totaling to 2.02% of the shares outstanding.

Shares of Dollar General Corporation (NYSE: DG) opened at $190.13, up $0.1 from a prior closing price of $190.03. However, the script later closed the day at $191.46, up 0.75%. The company’s stock has a 5-day price change of -0.95% and 6.50% over the past three months. DG shares are trading 21.83% year to date (YTD), with the 12-month market performance up to 39.93% higher. It has a 12-month low price of $125.00 and touched a high of $195.82 over the same period. Currently, 0.97 million shares have been traded, compared to an average intraday trading volume of 2.31 million shares. The stock is trading above its simple moving averages at the SMA20, SMA50, and SMA200, as the current price level is off by 0.86%, 1.72%, and 14.46% respectively.

Institutional ownership of Dollar General Corporation (NYSE: DG) shares accounts for 95.70% of the company’s 251.78M shares outstanding. Mutual fund holders own 50.38%, while other institutional holders and individual stakeholders account for 6.85% and 44.77% respectively.

It has a market capitalization of $47.82B and a beta (3y monthly) value of 0.52. The stock’s trailing 12-month PE ratio is 24.59, while the earnings-per-share (ttm) stands at $7.73. The company has a PEG of 2.06 and a Quick Ratio of 0.60 with the debt-to-equity ratio at 0.55. Price movements for the stock have been influenced by the stock’s volatility, which stands at 1.78% over the week and 1.87% over the month.

Analysts forecast that Dollar General Corporation (DG) will achieve an EPS of $2.38 for the current quarter, $1.62 for the next quarter and $8.88 for 2022. The lowest estimate earnings-per-share for the quarter is $2.1 while analysts give the company a high EPS estimate of $2.71. Comparatively, EPS for the current quarter was $1.74 a year ago. Earnings per share for the fiscal year are expected to increase by 12.00%, and 0.17% over the next financial year. EPS should shrink at an annualized rate of 11.96% over the next five years, compared to 13.70% over the past 5-year period.

If you are looking to buy this stock, then you may note that the average analyst recommendation by 28 brokerage firm advisors rate Dollar General Corporation (DG) as a “Moderate Buy” at a consensus score of 2.00. Specifically, 18 Wall Street analysts polled rate the stock as a buy, while 8 of the 28 advise that investors “hold,” and 0 rated it as a “Sell.”

Looking at the support for the DG, a number of firms have released research notes about the stock. Telsey Advisory Group stated their Outperform rating for the stock in a research note on May 29, 2020, with the firm’s price target at $200-$210. Telsey Advisory Group coverage for the Dollar General Corporation (DG) stock in a research note released on May 22, 2020 offered a Outperform rating with a price target of $200. Goldman was of a view on May 18, 2020 that the stock is Buy, while Loop Capital gave the stock Hold rating on April 30, 2020, issuing a price target of $175. Cleveland Research on their part issued Buy rating on April 02, 2020.

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