Dollar General stock price target raised to $120 from $119 at Truist

Investing.com - Truist Securities raised its price target on Dollar General (NYSE:DG) to $120.00 from $119.00 on Friday, while maintaining a Hold rating on the discount retailer’s shares. According to InvestingPro data, the stock is currently trading near Fair Value, with the company commanding a market capitalization of $24.56 billion.

The price target adjustment follows Dollar General’s second-quarter sales performance, which Truist noted was in line with its revised forecast of $10.73 billion. The company reported earnings of $1.86 per share, exceeding Truist’s estimate of $1.62, primarily due to better margins. The company’s financial health appears stable, with a current ratio of 1.25 indicating sufficient liquidity to meet short-term obligations.

Truist attributed the earnings outperformance to lower shrink and benefits from reduced inventory levels. The firm now expects stronger calendar year 2025 earnings than previously forecast, though it cautioned this performance will make 2026 gross margin comparisons more difficult.

Despite the improved performance, Truist maintained its Hold rating, noting that while Dollar General’s target of 7% operating income margins seems "aspirational," the company can likely make further improvements from current levels of approximately 5%.

Truist indicated it is "looking for opportunities to become more constructive" on Dollar General stock in the future.

In other recent news, Dollar General reported second-quarter financial results that exceeded expectations for sales and earnings per share. The discount retailer achieved a 2.8% increase in comparable store sales, positioning it at the higher end of its 2%-3% target range. Analysts have responded positively, with Raymond James raising its price target to $130 and maintaining an Outperform rating. Piper Sandler also increased its price target to $117, citing the strong quarterly performance, while maintaining a Neutral rating. BMO Capital reiterated its Market Perform rating and noted Dollar General’s recovery in margins. KeyBanc maintained its Sector Weight rating, highlighting the company’s positive performance across various categories. Guggenheim kept its Buy rating with a $125 price target, despite concerns about future growth prospects. These developments reflect Dollar General’s strategic execution and resilience in the current market.

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