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what it is
Dollar General sells cheap essentials and basic household stuff through 20,901 small-box stores across the U.S. and Mexico.
how it gets paid
Last year Dollar General made $40.6B in revenue. Consumables was the main engine at $33.3B, or 82% of sales.
why it's growing
Revenue grew 5.0% last year. The 36.17% EPS surprise mattered most because it showed cost control and margin repair were better than expected in a thin-margin business.
what just happened
Dollar General posted $1.28 in EPS versus a $0.94 estimate, a 36.17% beat.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
70/100 earnings predictability — reasonably predictable
21.4x trailing p/e — priced about right
1.7% dividend yield — cash in your pocket every quarter
14.5% return on capital — nothing to write home about
xvary composite: 60/100 — average
What they do
Dollar General sells cheap essentials and basic household stuff through 20,901 small-box stores across the U.S. and Mexico.
Dollar General wins by being close and cheap. It had 20,901 stores as of 10/31/25, so your quick run for detergent or snacks often ends there. Low-ticket retail (items usually priced at $10 or less) → cheap everyday purchases → so what: shoppers come in for basics, and that traffic supports the rest of the store.
How they make money
$40.6B
annual revenue · their business grew +5.0% last year
Consumables
$33.3B
Seasonal
$2.8B
Home products
$2.1B
Apparel
$1.2B
Other merchandise
$1.2B
The products that matter
everyday essentials retail
Consumables
$40.6B total revenue base
this is the traffic engine. the page does not break out segment dollars, and that matters. what we do know is the full company produced $40.6B in revenue, and staples are what keep the trips frequent.
traffic driver
higher-ticket discretionary mix
Seasonal & Home
part of recent traffic improvement
management flagged strength here. you care because DG keeps only 3.5% of sales as profit. when the mix improves, earnings usually move faster than revenue.
margin watch
new store growth
Store Expansion
450 new stores planned
the company plans roughly 450 new stores in fiscal 2026. when you already have 20,000-plus locations, expansion stops being about presence and starts being a referendum on unit economics.
execution bet
Key numbers
21.4x
earnings multiple
P/E → price divided by past earnings → so what: you are paying 21.4 years of trailing profit for a retailer with 1.5% projected earnings growth.
$44B
2026 sales goal
Management's fiscal 2026 revenue estimate is $44B, up from $40.6B annual revenue, so the company still needs real growth after the rebound.
8.0%
operating margin
Operating margin → profit after running the stores, before interest and taxes → so what: this is the core score for whether the turnaround is real.
14.5%
return on capital
Return on capital → profit generated from money invested in the business → so what: DG still turns store investment into decent returns.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 45 / 100
- long-term debt $5.1B (14% of capital)
- net profit margin 4.0% — keeps 4 cents of every dollar in revenue
- return on equity 20% — $0.20 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in DG 3 years ago → it's now worth $6,000.
The index would have given you $14,770.
source: institutional data · total return
What just happened
beat estimates
Dollar General posted $1.28 in EPS versus a $0.94 estimate, a 36.17% beat.
Fiscal third-quarter earnings rose 44% vs. prior year, and management raised its full-year outlook. Gross margin was 30.7%, which tells you the recovery is coming more from execution than fantasy.
$10.9B
revenue
$1.28
eps
30.7%
gross margin
the number that mattered
The 36.17% EPS surprise mattered most because it showed cost control and margin repair were better than expected in a thin-margin business.
-
dollar general delivered impressive fiscal third-quarter results (period ended october 31st).
-
earnings surged 44% from a year ago, to $1.28 a share.the performance was driven by improved traffic trends across all of the discount retailer’s core merchandise categories, with notable strength in consumables, seasonal, home products, and apparel. continued benefits from leadership’s store-expansion and turnaround initiatives were also supportive of comparisons.
-
we have raised our fiscal 2025 estimates.
-
dollar general has surpassed consensus expectations in three consecutive quarters, with leadership raising its full-year forecasts on each occasion.recent results have benefited from a significant consumer migration to valuebased shopping, likely motivated by persistently high inflation and increased economic strain. this shift in behavior has been broad-based across all income levels, with even higherend earners starting to prioritize price over brand. all in all, we are now targeting earnings to reach $6.50 a share this year, up from our previous call of $6.15.
-
the company is well positioned for continued bottom-line improvement in fiscal 2026.the combination of favorable macro trends and benefits from strategic growth initiatives augurs well for dollar general’s near-term earnings prospects. in regard to expansion, leadership expects to open roughly 450 new stores in the u.s. in fiscal 2026, and another 10 in mexico. these locations are mainly focused on rural areas and are expected to feature larger footprints with greater product assortments.
source: company earnings report, 2026
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What could go wrong
Dollar General's problem is simple: a $40.6B sales base looks sturdy, but a 3.5% net margin means even small mistakes show up fast.
high
discretionary strength fades before margins heal
management cited strength in seasonal, home products, and apparel. those baskets help the recovery story, and they are also the first place pressure tends to show up.
with only a 3.5% net margin, DG does not need a large sales miss to take a noticeable earnings hit.
med
store growth gets ahead of store economics
roughly 450 new stores are planned for fiscal 2026. expansion is easier to celebrate than to earn back if the base business is still only generating a 13.5% return on capital.
more units help revenue. They also demand that management prove the format still deserves fresh capital.
med
the stock already reflects a cleaner recovery than the numbers do
shares trade at $138.93 against a 3–5 year midpoint target of $111. that is an awkward setup if earnings momentum cools or margins stay stuck near 3.5%.
you are paying a full multiple for a business whose three-year total return record is still rough.
The business is large. The margin for error is not. If you hold DG, that's the risk frame that matters.
source: institutional data · regulatory filings · risk analysis
Pay attention to
key metric
whether margin improves faster than revenue
sales grew 5.0% last year. net margin was still 3.5%. if that gap stays wide, the recovery story starts sounding better than it looks.
earnings
whether $1.28 quarterly EPS was a step-change or a single clean quarter
one good quarter gets attention. a second one starts to look like a pattern. that's what the market is really paying for now.
trend
the path from $40.6B to $44B revenue
analysts expect about 8.4% top-line growth. that is faster than the last reported 5.0% pace, which means expectations are already climbing.
valuation risk
the gap between the $138.93 stock price and the $111 midpoint target
the market has moved ahead of the long-range midpoint. that usually means execution has to keep beating the script, not just meet it.
Analyst rankings
short-term outlook
average
momentum score 3. in human-speak, analysts do not see a strong near-term edge either way.
risk profile
average
stability score 3 means typical risk. not a bunker stock. not chaos either.
chart momentum
average
technical score 3 says the chart is acting like a normal stock, not sending a loud message.
earnings predictability
70 / 100
better than a messy turnaround, worse than a true staple. you should expect revisions if margins wobble.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 549 buyers vs. 407 sellers in 3q2025. total institutional holdings: 0.2B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$48
$173
$139
current price
$111
target midpoint · 20% from current · 3-5yr high: $195 (+40% · 10% ann'l return)
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