DOLLAR GENERAL CORP (DG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DG - US2566771059 - Common Stock
146.92 USD
+2.32 (+1.6%)
147.5 USD
+0.58 (+0.39%)
Overall DG gets a fundamental rating of 5 out of 10. We evaluated DG against 38 industry peers in the Consumer Staples Distribution & Retail industry. Both the profitability and the financial health of DG get a neutral evaluation. Nothing too spectacular is happening here. While showing a medium growth rate, DG is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
- DG had positive earnings in the past year.
- DG had a positive operating cash flow in the past year.
- In the past 5 years DG has always been profitable.
- Each year in the past 5 years DG had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of DG (4.03%) is comparable to the rest of the industry.
- Looking at the Return On Equity, with a value of 15.60%, DG is in the better half of the industry, outperforming 63.16% of the companies in the same industry.
- With a Return On Invested Capital value of 6.03%, DG perfoms like the industry average, outperforming 55.26% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for DG is significantly below the industry average of 28.30%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.03% | ||
| ROE | 15.6% | ||
| ROIC | 6.03% |
ROA(3y)5.77%
ROA(5y)7.34%
ROE(3y)27.8%
ROE(5y)32.31%
ROIC(3y)8.49%
ROIC(5y)10.34%
1.3 Margins
- With a decent Profit Margin value of 3.03%, DG is doing good in the industry, outperforming 76.32% of the companies in the same industry.
- DG's Profit Margin has declined in the last couple of years.
- DG's Operating Margin of 4.49% is fine compared to the rest of the industry. DG outperforms 78.95% of its industry peers.
- In the last couple of years the Operating Margin of DG has declined.
- DG's Gross Margin of 30.41% is amongst the best of the industry. DG outperforms 81.58% of its industry peers.
- In the last couple of years the Gross Margin of DG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.49% | ||
| PM (TTM) | 3.03% | ||
| GM | 30.41% |
OM growth 3Y-20.24%
OM growth 5Y-10.71%
PM growth 3Y-26.62%
PM growth 5Y-14.8%
GM growth 3Y-2.16%
GM growth 5Y-0.66%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), DG is creating some value.
- DG has about the same amout of shares outstanding than it did 1 year ago.
- DG has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, DG has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 2.56 indicates that DG is not a great score, but indicates only limited risk for bankruptcy at the moment.
- DG's Altman-Z score of 2.56 is on the low side compared to the rest of the industry. DG is outperformed by 65.79% of its industry peers.
- DG has a debt to FCF ratio of 2.20. This is a good value and a sign of high solvency as DG would need 2.20 years to pay back of all of its debts.
- With a decent Debt to FCF ratio value of 2.20, DG is doing good in the industry, outperforming 78.95% of the companies in the same industry.
- DG has a Debt/Equity ratio of 0.63. This is a neutral value indicating DG is somewhat dependend on debt financing.
- DG has a Debt to Equity ratio of 0.63. This is comparable to the rest of the industry: DG outperforms 47.37% of its industry peers.
- Even though the debt/equity ratio score it not favorable for DG, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.63 | ||
| Debt/FCF | 2.2 | ||
| Altman-Z | 2.56 |
ROIC/WACC0.75
WACC8.05%
2.3 Liquidity
- A Current Ratio of 1.17 indicates that DG should not have too much problems paying its short term obligations.
- Looking at the Current ratio, with a value of 1.17, DG is in line with its industry, outperforming 57.89% of the companies in the same industry.
- DG has a Quick Ratio of 1.17. This is a bad value and indicates that DG is not financially healthy enough and could expect problems in meeting its short term obligations.
- With a Quick ratio value of 0.24, DG is not doing good in the industry: 81.58% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.17 | ||
| Quick Ratio | 0.24 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 8.73% over the past year.
- The Earnings Per Share has been decreasing by -2.56% on average over the past years.
- DG shows a small growth in Revenue. In the last year, the Revenue has grown by 4.86%.
- The Revenue has been growing slightly by 7.91% on average over the past years.
EPS 1Y (TTM)8.73%
EPS 3Y-16.48%
EPS 5Y-2.56%
EPS Q2Q%43.82%
Revenue 1Y (TTM)4.86%
Revenue growth 3Y5.87%
Revenue growth 5Y7.91%
Sales Q2Q%4.58%
3.2 Future
- Based on estimates for the next years, DG will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.15% on average per year.
- Based on estimates for the next years, DG will show a small growth in Revenue. The Revenue will grow by 4.53% on average per year.
EPS Next Y13.07%
EPS Next 2Y11.52%
EPS Next 3Y11.08%
EPS Next 5Y11.15%
Revenue Next Year4.93%
Revenue Next 2Y4.55%
Revenue Next 3Y4.43%
Revenue Next 5Y4.53%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 22.26, DG is valued on the expensive side.
- DG's Price/Earnings is on the same level as the industry average.
- DG is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- A Price/Forward Earnings ratio of 19.96 indicates a rather expensive valuation of DG.
- DG's Price/Forward Earnings is on the same level as the industry average.
- DG's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.26 | ||
| Fwd PE | 19.96 |
4.2 Price Multiples
- DG's Enterprise Value to EBITDA is on the same level as the industry average.
- Based on the Price/Free Cash Flow ratio, DG is valued a bit cheaper than 78.95% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.82 | ||
| EV/EBITDA | 12.23 |
4.3 Compensation for Growth
- DG's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.7
PEG (5Y)N/A
EPS Next 2Y11.52%
EPS Next 3Y11.08%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 1.56%, DG has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 0.72, DG pays a better dividend. On top of this DG pays more dividend than 81.58% of the companies listed in the same industry.
- DG's Dividend Yield is comparable with the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
5.2 History
- The dividend of DG is nicely growing with an annual growth rate of 13.01%!
- DG has paid a dividend for at least 10 years, which is a reliable track record.
- The dividend of DG decreased recently.
Dividend Growth(5Y)13.01%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- 40.66% of the earnings are spent on dividend by DG. This is a bit on the high side, but may be sustainable.
- The dividend of DG is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP40.66%
EPS Next 2Y11.52%
EPS Next 3Y11.08%
DOLLAR GENERAL CORP / DG FAQ
Can you provide the ChartMill fundamental rating for DOLLAR GENERAL CORP?
ChartMill assigns a fundamental rating of 5 / 10 to DG.
Can you provide the valuation status for DOLLAR GENERAL CORP?
ChartMill assigns a valuation rating of 3 / 10 to DOLLAR GENERAL CORP (DG). This can be considered as Overvalued.
How profitable is DOLLAR GENERAL CORP (DG) stock?
DOLLAR GENERAL CORP (DG) has a profitability rating of 5 / 10.
What is the earnings growth outlook for DOLLAR GENERAL CORP?
The Earnings per Share (EPS) of DOLLAR GENERAL CORP (DG) is expected to grow by 13.07% in the next year.
Can you provide the dividend sustainability for DG stock?
The dividend rating of DOLLAR GENERAL CORP (DG) is 5 / 10 and the dividend payout ratio is 40.66%.