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On Tuesday, Telsey analysts raised the price target for Dollar General stock to $120 from $100 while maintaining a Market Perform rating. The revision follows Dollar General’s better-than-expected first-quarter 2025 results and an optimistic update to its 2025 guidance. According to InvestingPro data, 11 analysts have recently revised their earnings estimates upward, and the stock has gained 30% year-to-date, though it currently trades near its Fair Value.
Dollar General reported an adjusted earnings per share of $1.78 for the first quarter, surpassing both Telsey’s estimate of $1.49 and the FactSet consensus of $1.48. The company’s comparable sales increased by 2.4%, outperforming Telsey’s expectation of 1.0% and FactSet’s 1.5%. The operating margin also exceeded expectations, coming in at 5.5% compared to Telsey’s 4.8% and FactSet’s 4.7%. With a market capitalization of $21.37 billion and a P/E ratio of 21.9, InvestingPro analysis shows the company maintains strong financial health with liquid assets exceeding short-term obligations.
The company noted that while its core lower-income customers face spending constraints, it is seeing increased visits and spending from middle- and higher-income households. New trade-in customers have been making more frequent trips and purchasing more discretionary items. Dollar General’s market share in both consumables and non-consumables has grown, supported by its focus on value and new merchandising initiatives.
Traffic for the quarter was down 0.3%, but on a two-year stacked basis, it showed a 4% increase. Dollar General reported positive traffic in the early part of the second quarter of 2025, with all key categories and months showing growth. The company attributed strength in April to the timing of Easter.
Looking ahead, Dollar General is encouraged by its May performance, which includes positive traffic, and anticipates sustained momentum throughout 2025. However, the company remains cautious about tariffs, particularly regarding the uncertainty in consumer demand as retail price increases are implemented. InvestingPro subscribers can access detailed analysis including revenue growth trends of 4.77% and comprehensive financial health scores, along with 8 additional exclusive ProTips about Dollar General’s future prospects.
In other recent news, Dollar General Corporation (NYSE:DG) reported impressive financial results for the first quarter of 2025, surpassing Wall Street expectations with earnings per share (EPS) of $1.78, compared to the forecast of $1.46. Revenue for the quarter reached $10.4 billion, slightly above the anticipated $10.25 billion, marking a 5.3% increase year-over-year. Analysts from BofA Securities raised their price target for Dollar General stock to $135, maintaining a Buy rating, and highlighted the company’s strategic initiatives aimed at improving operational efficiencies and expanding market share. Truist Securities also raised their price target to $112, maintaining a Hold rating, following Dollar General’s better-than-expected first-quarter results, which included a 2.4% increase in comparable store sales. Meanwhile, CFRA upgraded the stock from a Sell to a Hold rating and increased the price target to $118, noting the positive impact of the company’s "Back to Basics" strategy. Dollar General’s ongoing efforts include store remodels, digital expansion, and a focus on non-consumable products, all aimed at sustaining growth and profitability. Despite these positive developments, analysts expressed caution regarding potential challenges such as tariffs and consumer behavior, which could affect the company’s performance in the future.
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