Evercore ISI adds Dollar General to its outperform list

Sam Boughedda

Wed, May 14, 2025, 7:29 AM 2 min read

Investing.com -- Evercore ISI has added Dollar General (NYSE:DG) to its Outperform Tactical and Action Positioning Call List.

In a enactment to clients connected Wednesday, the steadfast pointed to improving fundamentals and a imaginable net bushed erstwhile the institution reports first-quarter results connected June 3.

Evercore ISI said Dollar General is showing aboriginal signs of a palmy turnaround, driven by “back to basics focus, improved processes, and imaginable for little shrink.”

The steadfast pointed to “sales momentum identified successful our 2nd Measure information connected Bloomberg,” suggesting upside to first-quarter comparable income and net per share.

“Dollar General appears to beryllium driving turnaround traction evidenced by 1Q comp income that we judge are apt affirmative 2%+ vs. our anterior outlook of up 1.2,” the analysts wrote.

Evercore besides raised its first-quarter EPS estimation to $1.52, supra the Street’s statement of $1.47, and projected an further $100 cardinal successful gross with a 20% flow-through rate.

Traffic trends are said to beryllium improving, according to Evercore’s analysis, driven by “improved in-store execution, little substance prices, and imaginable stock summation from pharmacy closures and/or Family Dollar rationalization.”

Looking ahead, the steadfast sees country for further upside. “We expect that DG tin triumph immoderate aggregate enlargement from 14x toward a scope of 15-17x, which implies a near-term trading scope of astir $95-100 for the stock.”

Evercore besides sees second-quarter EPS perchance rising from $1.58 to $1.65+, with comp income apt reaching 2.5% versus the existent statement of 1.9%.

While the steadfast acknowledged longer-term concerns — including pricing gaps versus Walmart (NYSE:WMT), labour outgo pressures, and tariffs — it believes Dollar General’s net imaginable successful 2025 and 2026 is “attainable, truthful agelong arsenic backmost to basics execution persists.”

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