Overview

• U.S. discount retailer's Q4 sales rose 5.9%, slight beat versus analyst expectations

• Q4 diluted EPS surged 121.8% yr/yr, driven by margin expansion and lower impairment charges

• Company expects fiscal 2026 net sales growth of 3.7%-4.2% and EPS of $7.10-$7.35

Outlook

• Dollar General sees fiscal 2026 net sales growth of 3.7% to 4.2%

• Company expects fiscal 2026 same-store sales growth of 2.2% to 2.7%

• Dollar General forecasts fiscal 2026 diluted EPS of $7.10 to $7.35

Result Drivers

• SAME-STORE SALES GROWTH - Q4 same-store sales rose 4.3%, reflecting higher customer traffic and average transaction amounts, with growth in all major categories

• GROSS MARGIN EXPANSION - Gross profit rate increased due to lower shrink, higher inventory markups, and lower inventory damages, partially offset by increased LIFO provision

• LOWER IMPAIRMENT CHARGES - Operating profit and SG&A ratio benefited from reduced impairment charges following last year's store portfolio optimization review

Company press release: ID:nBw6SfLJda

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 13 "strong buy" or "buy", 17 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the discount stores peer group is "buy"

• Wall Street's median 12-month price target for Dollar General Corp is $145.00, about 0.1% below its March 11 closing price of $144.84

• The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 16 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)