Dollar General price forecast after posting slight FQ3 earnings beat

on Dec 3, 2021
  • Dollar General shares on Thursday declined by nearly 3%.
  • The company reported its most recent quarterly results before markets opened.
  • Its earnings outperformed estimates while revenue was in line.

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On Thursday, Dollar General Corp (NYSE:DG) shares declined by nearly 3% after announcing its most recent quarterly results. The company reported its most recent quarterly results before markets opened, beating earnings expectations.

However, revenue for the quarter was in line with Street forecasts. Dollar General also declared a quarterly dividend of $0.42 per share reflecting a forward annual yield of 0.78%.

The company posted FQ3 GAAP earnings per share of $2.08, slightly outperforming the average for analyst expectations of $2.03. On the other hand, revenue for the quarter edged slightly higher by 3.7% from the same quarter a year ago to $8.5 billion, in line with expectations.

Should you bet on growth?

From an investment perspective, Dollar General shares trade at reasonable trailing 12-month and forward P/E ratios of 20.74 and 19.22, respectively. As a result, the stock could be a compelling option for value investors.

Moreover, analysts expect its EPS to grow by 60% this year before rising at an average annual rate of 6.63% over the next five years. Therefore, it could also gain the attention of growth investors.

Source – TradingView

Technically, Dollar General shares seem to be trading within a descending channel formation in the intraday chart. As a result, the stock has moved closer to the oversold conditions of the 14-day RSI.

Therefore, investors could target potential rebounds at about $225.77, or higher at $235.26. On the other hand, if the decline continues, Dollar General could find support at about $210.46, or lower at $201.08.


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