Guggenheim Raises Dollar General PT to $125, Reiterates Buy Rating

Guggenheim Raises Dollar General PT to $125, Reiterates Buy Rating

Guggenheim Securities has raised its price target for Dollar General (DG) to $125, reiterating its buy rating on the discount retailer. The upgrade comes after the company reported strong second-quarter results, which exceeded market expectations. The stock rose 3.2% in premarket trading following the announcement.

Dollar General's net income for the quarter ended Aug. 1 was $1.86 per share, up from $1.70 the year before, surpassing the average analyst estimate on FactSet of $1.58. Sales improved by 5.1% to $10.73 billion, ahead of the Street's view for $10.68 billion. Same-store sales increased by 2.8%, with customer traffic and average transaction values rising by 1.5% and 1.2%, respectively [1].

The company's gross profit margin as a percentage of sales rose to 31.3%, up from 27.6% a year ago, driven by lower shrink, higher inventory markups, and reduced inventory damages. Selling, general, and administrative expenses increased to $2.77 billion from $2.51 billion on an annual basis [2].

Guggenheim analysts cited the company's strong performance across both consumable and non-consumable categories, as well as its initiatives in store remodels and delivery partnerships, as key drivers for the upgrade. The firm expects Dollar General to continue delivering solid earnings growth and maintain its position on everyday value.

References:
[1] https://finance.yahoo.com/news/dollar-general-lifts-fiscal-2025-130613669.html
[2] https://www.fool.com/earnings/call-transcripts/2025/08/29/dollar-general-dg-q2-2025-earnings-call-transcript/