Dollar General Corporation (DG) is set to report third-quarter earnings before the market opens on Thursday, December 4, and Wall Street is watching to see if the discount retailer can continue its modest growth trajectory.
Analysts are forecasting quarterly earnings of 95 cents per share for the Goodlettsville, Tennessee-based company, which would represent a solid improvement from the 89 cents per share reported in the same period last year. On the revenue side, consensus estimates call for $10.64 billion, up from $10.18 billion a year earlier.
The track record here is mixed. Dollar General has beaten analyst revenue estimates in five of the last 10 quarters, including most recently in the second quarter. That's a coin flip success rate, which probably explains why analysts aren't exactly pounding the table with bullish calls right now.
Shares closed Wednesday at $109.89, down 0.1% on the day.
What the Accurate Analysts Are Saying
Looking at recent forecasts from Wall Street's most accurate analysts covering Dollar General, the consensus leans cautious with a mix of neutral and buy ratings. Here's the breakdown:
UBS analyst Michael Lasser holds the most optimistic view with a Buy rating and a $135 price target, raised from $128 on August 29. Lasser also boasts the highest accuracy rate among this group at 79%, so his bullish stance carries some weight.
Guggenheim's John Heinbockel also maintains a Buy rating with a $125 target, set on August 29. His accuracy rate comes in at 62%.
On the more neutral side, Morgan Stanley's Simeon Gutman has an Equal-Weight rating with a $125 price target, bumped up from $115 on August 29. Gutman's accuracy rate is 68%.
JP Morgan analyst Matthew Boss sits at Neutral with a $115 target, raised from $109 on October 27. Boss has a 67% accuracy rate.
Telsey Advisory Group's Joseph Feldman rounds out the group with a Market Perform rating and a $123 price target as of November 26. Feldman's accuracy rate is 66%.
The price targets cluster between $115 and $135, suggesting most analysts see limited upside from current levels but aren't ready to call for significant downside either. That's about as lukewarm as it gets, which might be the right call given the company's inconsistent record of beating estimates lately.
With Thursday's earnings just around the corner, investors will get a clearer picture of whether Dollar General can deliver on expectations or if the cautious analyst positioning proves prescient.