Narrow-moat Dollar General delivered fiscal 2024 first-quarter results that slightly exceeded our expectations. However, we do not plan to significantly alter our $145 fair value estimate, as signs of intensifying price competition should remain a headwind to margins.
Dollar General is insulated from intense retail competition by its positioning in thinly populated rural towns, which are largely unattractive for most competing retail banners.
The dollar store footprint looks crowded today—Dollar General, Dollar Tree, and Family Dollar account for over 37,000 storefronts—which could weigh on opportunities to drive growth via store expansion.
|
Metric
|
DG
|
TGT
|
WMT
|
|---|---|---|---|
Price/Earnings (Normalized) | 18.62 | 17.53 | 29.35 |
Price/Book Value | 4.01 | 5.22 | 6.43 |
Price/Sales | 0.72 | 0.68 | 0.80 |
Price/Cash Flow | 10.99 | 9.51 | 15.08 |
|
Metric
|
DG
|
TGT
|
WMT
|
|---|---|---|---|
Quick Ratio | 0.10 | 0.27 | 0.20 |
Current Ratio | 1.19 | 0.91 | 0.83 |
Interest Coverage | 7.49 | 11.55 | 8.94 |
|
Metric
|
DG
|
TGT
|
WMT
|
|---|---|---|---|
Return on Assets (Normalized) | 5.07% | 7.99% | 6.48% |
Return on Equity (Normalized) | 23.87% | 34.30% | 20.75% |
Return on Invested Capital (Normalized) | 7.31% | 14.78% | 12.00% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Capital Allocation
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|---|
WMT
| Walmart Inc | Ghpydnhl | Rlp | $530.0 Bil | |
COST
| Costco Wholesale Corp | Gytfgwscbd | Bkrdz | $359.1 Bil | |
TGT
| Target Corp | Ryqnpzzyvl | Bcqn | $72.2 Bil | |
WMMVF
| Wal - Mart de Mexico SAB de CV | — | Dssz | $65.3 Bil | |
WMMVY
| Wal - Mart de Mexico SAB de CV ADR | — | Tfqt | $65.2 Bil | |
DLMAF
| Dollarama Inc | — | Zgz | $26.3 Bil | |
DLTR
| Dollar Tree Inc | Mmdjfktk | Fcj | $25.7 Bil | |
DQJCY
| Pan Pacific International Holdings Corp ADR | — | Sjph | $15.4 Bil | |
BJ
| BJ's Wholesale Club Holdings Inc | — | Ctqxptm | $11.7 Bil |
