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Investing.com - UBS raised its price target on Dollar General (NYSE:DG) to $135.00 from $128.00 on Friday, while maintaining a Buy rating on the discount retailer’s stock. The new target represents potential upside from the current price of $111.71, with InvestingPro data showing the stock has already gained over 52% in the past six months.
The price target increase follows Dollar General’s second-quarter earnings report, which UBS described as evidence that the company is on a positive trajectory with accelerating earnings recovery. Seven analysts have recently revised their earnings estimates upward, with price targets ranging from $80 to $138, according to InvestingPro data.
Dollar General achieved modest comparable sales growth in the quarter despite not implementing significant tariff-related price increases, indicating the effectiveness of its various initiatives in driving consistent top-line results. The company’s revenue grew nearly 5% over the last twelve months, reaching $41.65 billion. Get deeper insights into Dollar General’s performance metrics and growth potential with a comprehensive Pro Research Report, available exclusively on InvestingPro.
The retailer expanded its digital presence through an enhanced partnership with DoorDash that grew 60%, introduced Uber Eats delivery, and invested in its own online platform as part of its sales growth strategy.
Dollar General also demonstrated margin recovery capabilities, particularly in shrink management, which saw a 108-basis-point improvement in the second quarter, contributing to what UBS characterized as robust bottom-line performance.
In other recent news, Dollar General reported second-quarter earnings of $1.86 per share, surpassing Truist Securities’ estimate of $1.62, driven by improved margins. The company achieved sales of $10.73 billion, aligning with Truist’s revised forecast. Following these results, Truist raised its price target on Dollar General to $120, maintaining a Hold rating. Raymond James also increased its price target to $130, noting the retailer’s outperformance in comparable sales, gross margin percentage, and earnings per share. Piper Sandler adjusted its price target to $117, highlighting a 2.8% increase in comparable store sales, which met the higher end of Dollar General’s target range. BMO Capital reiterated its Market Perform rating with a $115 price target, citing the company’s effective execution and margin recovery strategy. KeyBanc maintained its Sector Weight rating, observing positive growth across all product categories, attributed to increased trade-down activity and better trends in discretionary items. These developments reflect a positive trajectory for Dollar General in its recent financial performance.
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