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On Wednesday, BMO Capital analysts adjusted their outlook on Dollar General stock (NYSE: NYSE:DG) by raising the price target to $115 from $90, closer to the stock’s current trading price of $111.60. Despite maintaining a Market Perform rating, the analysts cited improved execution and strategic momentum as key factors in their decision. According to InvestingPro data, the stock has shown remarkable momentum with a 15% gain in the past week alone.
Dollar General’s recent performance in the first quarter of 2025 has shown significant improvements, marking the company’s first earnings per share growth in two years, with current earnings at $5.24 per share. The analysts highlighted the success of the company’s back-to-basics strategies, which have contributed to this positive trend. InvestingPro analysis suggests the stock is currently in overbought territory, with 8 additional ProTips available for subscribers.
Management at Dollar General noted a high level of trade-down activity, which could be attributed to macroeconomic factors or enhanced in-store execution, according to the analysts. While the fundamentals are improving, the analysts noted that Dollar General’s digital business is still in its early stages and faces intense competition.
The analysts reiterated their Market Perform rating while raising their earnings per share estimates and price target. They noted that Dollar General’s valuation has rebounded to levels near or slightly above historical averages.
In other recent news, Dollar General has reported strong fiscal first-quarter 2025 results, exceeding expectations in earnings and revenue. Analysts from several firms have responded positively to these developments. Loop Capital raised Dollar General’s stock price target to $110, noting improvements in gross and operating margins and an optimistic outlook for 2025. Bernstein SocGen increased their target to $126, highlighting progress in gross margin recovery and increased comparable sales. Raymond (NSE:RYMD) James set their target at $125, citing a successful "back-to-basics" strategy and positive customer engagement trends.
Goldman Sachs also raised their price target to $115, maintaining a Buy rating due to strong top-line results and improved earnings per share. Similarly, Morgan Stanley (NYSE:MS) adjusted their target to $115, reflecting a positive view on Dollar General’s margin execution and digital expansion plans. Despite these positive assessments, some analysts expressed caution about potential challenges, such as macroeconomic factors and policy changes that could affect future performance. Overall, the recent analyst upgrades reflect confidence in Dollar General’s strategies and market position.
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