DG
Dollar General Corporation$131.84
Sell
Target $90.17
Report: Mar 13, 2026Consumer Defensive • Discount Stores • Asset-Based OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$131.84-31.6%
Rec: SellConviction: Low
Entry Target
N/A
N/A
Fair Value
$90.17
(32% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$158.23
52 Week Low$84.70
Avg. 3 Month Volume3.24M
Efficiency
LTM Gross Margin30.7%
LTM EBITDA Margin7.6%
LTM EBIT Margin5.1%
LTM Operating Margin5.2%
LTM ROA4.8%
LTM ROE18.7%
LTM ROIC6.4%
LTM ROCE9.0%
Capital Structure
Market Cap (MM)$26.1B
Enterprise Value (MM)$40.7B
Shares Outstanding220.17M
Total Debt (MM)$15.72B
Cash & Equivalents (MM)$1.14B
LTM Net Debt (MM)$14.58B
LTM Net Debt/EBITDA4.5x
Growth
TTM Rev. Growth5.2%
Last 3-Yr Rev. CAGR4.1%
Last 3-Yr EBITDA CAGR-7.2%
Last 3-Yr EPS CAGR-13.9%
Valuation
Street Target Price$145.00
LTM EV/Revenue1.0x
LTM EV/Gross Profit3.1x
LTM EV/EBIT18.6x
LTM EV/EBITDA12.6x
LTM P/E17.3x
LTM EV/FCF17.0x
LTM P/FCF10.9x
LTM P/TB1.0x
LTM P/B3.1x
Dividend Yield2.0%
Payout Ratio34.4%
Executive SummarySituation: Current price is $131.84 versus fair value $90.17 (-31.6% expected return), and valuation confidence is stable. Debate: Bull case depends on Failure to meet the 6-7% operating margin target by 2028. Bear case centers on Consumable Mix Shift Persistence. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
Management's 4-pillar strategy successfully drives non-consumable penetration to 20% by 2029, restoring margins; Digital delivery expansion to 18,000 stores provides a sustainable 80 basis point lift to same-store sales.
Bear Case
ROIC remains structurally below the 9.5% WACC, indicating that every dollar of new capital invested destroys shareholder value; High leverage of 5.2x Net Debt/EBITDA limits the company's ability to navigate a prolonged consumer downturn.
Key Catalysts
Mid-Term (6-18 months)Impact: High
Failure to meet the 6-7% operating margin target by 2028. Management has set a high bar for margin recovery, but persistent labor costs and...
Near-Term (0-6 months)Impact: Moderate
Continued Insider Selling and Lack of Buybacks. Management has paused share repurchases due to leverage constraints. If insiders continue to...
Long-Term (18+ months)Impact: Moderate
Dollar General is relevant for analysis now because it has just completed a fiscal year where revenue grew but earnings collapsed, highlight...
Primary Risks
Concern: High
Consumable Mix Shift Persistence. The mechanism of risk is a permanent shift in consumer behavior toward low-margin essentials, which preven...
Concern: Medium
Regulatory and Safety Scrutiny. Ongoing OSHA investigations and settlements lead to higher structural labor costs as the company is forced t...
Concern: Medium
The stewardship verdict is mixed. While the board features strong financial expertise-including Audit Chair Ana Chadwick, a former CFO-the l...
Recent Activity
2025-12-05Analyst Target
+5.65%Firm: BMO Capital Price Target: $130.00 Price When Posted: $125.29 Implied Upside: +3.8%
2025-12-04SEC Filing (8-K)
+14.01%Dollar General reports Q3 2025 results with 4.6% sales growth and updates fiscal 2025/2026 guidance
2025-06-03SEC Filing (8-K)
+15.85%Dollar General reports Q1 2025 results with sales growth and updates guidance amid tariff uncertainty
2025-03-13SEC Filing (8-K)
+6.81%Dollar General reports Q4 and FY 2024 results with store portfolio optimization and FY 2025 guidance
2024-08-29SEC Filing (8-K)
-32.15%Dollar General reports Q2 2024 results with 4.2% sales growth and updates fiscal 2024 guidance
Valuation Table
9.8/10Decision Grade
Scenario Range
$32
Bear
$65
Base
$114
Bull
$132