Following Dollar General's second-quarter earnings report, UBS' Michael Lasser has taken a sanguine tone that is similar to that of a number of other analysts. In reiterating his 'buy' rating and $85 target for Dollar General (Ticker: DG), Lasser says CEO Todd Vasos and his team still have a number of ways to hit their profit growth goals.
From here, even if the company's algorithm rests on a longer-term comp that hovers around the 3% range, we think it can still produce mid-teens EPS growth with optionality to the upside. We would use the pullback as an opportunity.
A number of analysts have tweaked their price targets for shares of Dollar General following the company’s second-quarter profit report, which investors met with a good bit of antipathy. Most of the Street moves so far have been positive, though: Scott Ciccarelli at RBC Capital has taken his target to $88 from $86 — Dollar General (Ticker: DG) is changing hands this morning around $74 — and Matt Boss at JPMorgan Chase is even more upbeat, having taken his target to $90 from $87.
Paul Trussell at Deutsche Bank is a little less upbeat — even though he is keeping his ‘buy’ rating — and has tweaked his target to $84 from $85. And Meredith Adler at Barclays is even less optimistic. She has an ‘equal weight’ rafting on Dollar General and, with a $76 target (up from $74), still sees the stock going nowhere for a while.
Outgoing Dollar General CFO David Tehle late last week cashed in some of his stock holdings. The 58-year-old, who will step down in a few weeks, exercised about 23,000 options that would have expired between 2022 and 2024, paying between $45 and $58 to do so. He then sold more than 36,000 shares — almost three-fourths of this total holdings — for an average of almost $78 per share. Tehle's take from the transactions was almost $1.7 million.
Shares of Dollar General (Ticker: DG) are up about 1.5 percent to about $77 after RBC Capital's Scott Ciccarelli upgraded the company to 'outperform' from 'sector perform' and lifted his price target to $86 from $82. Ciccarelli's upgrade came a day after Raymond James analyst Dan Wewer hiked his rating on Dollar General by two notches to 'strong buy,' saying the company is poised to crank its revenue growth up a notch. Wewer sees the stock climbing to $90.
Analyst Taposh Bari at Goldman Sachs has cut his rating on shares of Nashville-based Genesco to 'sell from 'neutral' after the company reported its first-quarter numbers. He sees the stock (Ticker: GCO), which was up about 1 percent to $67.33 Thursday afternoon, falling to $57 in the coming year.
Over at UBS, Michael Lasser says things are setting up for Dollar General to have a really good run in the coming quarters as its investments in labor and back-end operations begin to pay off. He has ticked his target for Dollar General (Ticker: DG) to $85 from $84. The stock is changing hands this afternoon at about $75.60.
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