How Does This Discount Retailer Operate?
Dollar General runs a chain of small-format discount stores focused on everyday essentials. The business is built around frequent, low-ticket trips and a broad store footprint that prioritizes convenience. It sells a mix of consumables and general merchandise aimed at value-oriented shoppers. Execution hinges on keeping shelves stocked efficiently while maintaining a low-cost operating model.
Are Revenues Rising Faster Than Costs?
FundamentalsFor the latest annual period, reported in USD, revenue was about USD 42.7 billion, up 5.2% year over year, with EBIT at roughly USD 2.2 billion. Profitability stayed narrow in percentage terms, with a 30.83% gross margin, a 5.26% operating margin, and a 3.63% net profit margin on a trailing basis.
Cash generation, measured by the cash flow proxy, was around USD 2.7 billion, supported by USD 1.0 billion of depreciation and amortization, while capital spending was about USD 124 million. The balance sheet showed roughly USD 1.1 billion of cash against USD 14 million of total debt.
Is The Market Pricing Efficiency Fairly?
DCF / MultiplesAt USD 103.70 per share, the price sits below the central fair value estimate and above the lower bound, within a DCF range running from USD 76.76 to USD 120.88 to USD 177.90. The stock also trades at 14.60 times trailing earnings and 7.83 times EV/EBITDA, with a 0.53 times price‑to‑sales multiple.
Solid Execution Near Fair Value
TakeawayOperations are producing meaningful cash even with thin margins. The case depends on keeping revenue growing without margin erosion. Reinvestment needs to stay selective and productive. If costs rise faster than sales, earnings power can fade quickly. Overall, execution looks solid, and pricing sits near fair value.