Dollar General expected to outperform Dollar Tree over next five years due to improved earnings

From NASDAQ.: 2024-09-22 05:32:00

Shares of Dollar General (NYSE: DG) are predicted to outperform Dollar Tree (NASDAQ: DLTR) over the next five years due to expected improvements in earnings. Despite both stocks being down from their all-time highs, Dollar General is expected to see a significant increase in earnings, making it a better investment choice. The narrative that e-commerce is harming these companies is inaccurate, as both Dollar Tree and Dollar General are seeing positive trends with customer behavior.

Dollar General expects to have full-year EPS of at least $5.50, with earnings potentially nearing a bottom as the company addresses inventory issues. The company’s financials historically improve before the official start of a recession, indicating a positive outlook for its profitability. While Dollar Tree is also expected to benefit from improving consumer spending, Dollar General has a track record of returning more capital to shareholders and paying a fast-growing dividend.

Investors looking to buy stocks should consider the opportunities highlighted by The Motley Fool Stock Advisor analyst team, which has identified the 10 best stocks for potential high returns. Dollar General, despite not being on the list, presents growth potential in the coming years, especially with its focus on improving earnings and returning value to shareholders. Consider the long-term performance and investment potential before making a decision on buying Dollar General stock.



Read more at NASDAQ.: Why Dollar General Stock Is a Better Buy Than Dollar Tree Stock