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Investing.com - Piper Sandler raised its price target on Dollar General (NYSE:DG) to $117.00 from $115.00 on Friday, while maintaining a Neutral rating on the stock. According to InvestingPro data, the stock is currently trading near Fair Value levels, with 7 analysts recently revising their earnings expectations upward for the upcoming period.
The price target increase follows Dollar General’s second-quarter results, which showed both sales and earnings per share exceeding expectations. The discount retailer, now valued at $24.56 billion, reported a 2.8% comparable store sales increase, positioning it at the higher end of its 2%-3% target range. The company maintains healthy liquidity with a current ratio of 1.25, demonstrating strong financial management.
Dollar General demonstrated improved execution compared to recent years, with notable gross margin benefits from lower shrink, continued inventory reductions, and a modest shift toward discretionary goods in its sales mix. The company’s gross profit margin stands at 30.15%, while revenue growth reached nearly 5% in the last twelve months. For deeper insights into Dollar General’s financial health and growth prospects, check out the comprehensive analysis available on InvestingPro.
The company is rapidly expanding its same-day delivery capabilities through a partnership with DoorDash and announced a new collaboration with Uber Eats. Management views changes from the One Big Beautiful Bill as largely favorable for its lower-income customer base, with upcoming SNAP cuts not expected to significantly impact Dollar General’s predominantly employed customers starting in October.
Piper Sandler’s new price target represents 18 times the firm’s 2026 earnings per share estimate for Dollar General, with the research firm noting that while the outlook through the second half of 2025 appears attractive, comparisons will become more challenging in 2026.
In other recent news, Dollar General reported impressive financial results for the second quarter of 2025, exceeding analysts’ expectations. The company posted earnings per share of $1.86, which was significantly above the forecasted $1.57, marking an 18.47% surprise. Revenue also surpassed predictions, reaching $10.73 billion compared to the anticipated $10.68 billion. This strong performance was driven by a 2.8% growth in comparable sales, with positive results across all categories, including consumables, seasonal, home, and apparel.
KeyBanc maintained its Sector Weight rating for Dollar General, acknowledging the better-than-expected quarterly results. Guggenheim reiterated its Buy rating with a price target of $125.00, citing the company’s defensive position despite concerns about future growth prospects. Telsey Advisory Group raised its price target to $123.00 while maintaining a Market Perform rating, noting Dollar General’s transition to a mature retailer with a focus on in-store enhancements. Meanwhile, CFRA increased its price target to $126.00, highlighting the success of the retailer’s "Back to Basics" strategy and solid sales growth in consecutive quarters.
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