Overview Dollar General Corporation operates a broad‑scale discount retail chain focused on low‑priced, high‑frequency consumer goods and displays a financially conservative profile with solid cash generation and moderate leverage. Key Strengths The company shows several concrete strengths: revenue per share has compounded at about a 9.25% five‑year CAGR ( 0.0925 ) and the last reported Revenue Pe
Dollar General Corporation operates a broad‑scale discount retail chain focused on low‑priced, high‑frequency consumer goods and displays a financially conservative profile with solid cash generation and moderate leverage.
The company shows several concrete strengths: revenue per share has compounded at about a 9.25% five‑year CAGR (0.0925) and the last reported Revenue Per Share level was $154.97, supporting long‑term top‑line expansion [EPS Diluted & Revenue per Share].
Profitability metrics remain healthy on absolute terms with a gross margin around 31.6%, an operating margin near 9.4% and a net margin of about 7.0% in the most recent margin snapshot [Profit Margin Trends].
Balance sheet and cash‑flow coverage are conservative — debt/equity is 0.5364, interest coverage is roughly 9.56x (9.5576), and operating cash flow in the dataset is shown at $1.71B TTM with operating cash exceeding net income by about 1.39x (1.3853), indicating earnings largely convert to cash [Earnings Quality Analysis] [Return on Equity (ROE)].
There are notable areas of concern. Net income exhibited a substantial peak‑to‑trough move from $3.33B (2021 peak) down to about $1.13–$1.15B in 2025 before recovering to $1.51B TTM, highlighting material earnings volatility year‑to‑year [Revenue & Net Income].
Per‑share momentum has been uneven: diluted EPS fell from $11.19 in late 2023 to $5.10 by 2025‑01‑31 before rebounding to $6.85 (most recent), while the most recent one‑year revenue‑per‑share growth data point was only 1.4%, showing a deceleration in sales growth per share [EPS Diluted & Revenue per Share] [Revenue & Net Income].
Cash‑flow allocation also shows persistent negative investing flows (about −$782.5M TTM) and increasingly negative financing cash flows most recently (−$783.3M TTM), which together suggest rising cash deployment needs despite positive operating cash generation [Strategic Capital Allocation].
Key fundamental metrics to watch going forward are stabilization of net income and quarterly net income volatility (recent quarter swings ranged from $191.2M to $837.7M), near‑term trends in revenue‑per‑share growth versus the prior ~9.25% CAGR, the trajectory of operating margin and net margin around the current 9.4% / 7.0% levels [Profit Margin Trends].
Further, the relationship of operating cash flow to reported earnings (currently approximately 1.39x) [Earnings Quality Analysis], and financing‑flow/debt metrics including debt/equity (0.5364) and interest coverage (~9.56x), as well as the evolving P/E multiple which moved from 13.9x to 20.9x in recent reported points [Price-to-Earnings (PE) Ratio Trend],
The foundation of business quality and long-term value creation
DOLLAR GENERAL CORP's recent net income shows quarter-to-quarter volatility. It was $191.2M on 2025-01-31, rose to $391.9M on 2025-05-02, dipped to $282.7M on 2025-10-31, then jumped to $837.7M on 2026-01-30 before falling back to $444.1M on 2026-05-01. The most notable inflection is the large increase in the quarter ending 2026-01-30 followed by a decline, leaving net income elevated relative to many mid‑2024/2025 quarters but below the peak seen in early 2026.
Revenue observations are less frequent; the most recent reported revenue is $34.22B for the period ending 2022-01-28. Earlier revenue records include $33.75B on 2021-01-29 and smaller historical values in prior years, but no revenue figures are recorded after the 2022-01-28 entry. The most recent quarterly net income was $444.1M (period ending 2026-05-01). The most recent recorded revenue was $34.22B (period ending 2022-01-28).
Why Growth Matters
Consistent revenue and earnings growth are the lifeblood of successful long-term investments. Companies that can grow their top line (revenue) and bottom line (net income) over many years demonstrate they have products or services customers value and are willing to pay for repeatedly.
Revenue Growth shows whether the company is expanding its market reach, gaining market share, or successfully launching new products.Net Income Growth demonstrates the company can convert that revenue into actual profits while managing costs effectively.
Look for steady, sustainable growth rather than erratic spikes. The best businesses compound earnings year after year, creating tremendous value for shareholders over time. Companies that can grow earnings faster than revenue are improving their profitability—a sign of operational excellence and competitive strength.
Year-over-year growth rates for revenue and earnings per share
Reading the Growth Rate Chart
This chart converts the absolute per-share figures into year-over-year percentage changes, making it easy to see whether growth is accelerating, decelerating, or reverting to trend — regardless of the company's absolute size.
Revenue per Share Growth (1-year, split-adjusted) measures how quickly the top line is expanding on a per-share basis. Sustained positive growth signals that the company continues to win customers and grow its addressable market.EPS Diluted Growth (1-year, split-adjusted) measures how quickly earnings are compounding for each shareholder. When EPS growth consistently outpaces revenue growth, operating leverage and margin expansion are at work.
Look for consistency, not just magnitude. A company that reliably grows EPS 10–15% per year is far more valuable than one that alternates between 50% spikes and deep contractions. Negative EPS growth during a period of positive revenue growth is a red flag — costs are rising faster than sales. Quarters where both lines converge near zero or go negative deserve close scrutiny.
How revenue converts to net income for the most recent annual period
Period Information
Report Type: Annual (10-K)
Period: Jan 2021 to Jan 2022
Analyzing long-term margin stability and competitive positioning
DOLLAR GENERAL CORP's gross margin has been broadly stable over the multi-year series, oscillating around the low-30% range (30.5–31.8%). Operating and net margins show more variability: operating margin moved between about 8.3% and 10.5%, while net profit margin ranged from roughly 5.5% to 7.9%. The most pronounced recent change occurred around the 2021 period, when operating and net margins both rose to their multi-year peaks before moderating in the latest quarter.
In the most recent quarter (period ending 2022-01-28), gross margin eased slightly from the 2021 peak, and both operating and net margins declined from their 2021 highs but remained above several earlier-year levels. The most recent gross margin was 31.6%, the most recent operating margin was 9.4%, and the most recent net profit margin was 7.0%.
Understanding Profit Margins
Between Jan 2021 and Jan 2022, Dollar General Corp converts every dollar of revenue through the following stages:
Sustainable competitive advantages reveal themselves through consistently superior profit margins over extended periods. Companies with durable economic moats maintain pricing power and operational efficiency that competitors struggle to match.
A sign of durable competitive advantage is earning sustained higher margins than competitors.Look for margins that remain stable or improve over time, especially during economic downturns. Declining margins may signal increasing competition, pricing pressure, or deteriorating business fundamentals.
Comparing reported earnings to actual cash generation
Net income on a trailing twelve‑month basis for DOLLAR GENERAL CORP rose to a multi‑year peak in 2021, reaching $3.33B as of 2021-04-30, and remained above $2.4B through 2023. Beginning in 2024–2025, there is a marked decline: net income fell to $1.15B (period end 2025-05-02) and $1.13B (period end 2025-01-31), before recovering to $1.51B in the most recent period (period end 2026-01-30). The key inflection points are the 2021 peak, the 2023–2025 decline, and the uptick to $1.51B in early 2026.
Operating cash flow (TTM) in the provided dataset is only available for older periods; the most recent operating cash flow observation is $1.71B (period end 2017-05-05). In earlier comparable entries, operating cash flow values—such as $1.61B on 2017-02-03 and $1.38B on 2016-01-29—were generally in the same range or exceeded contemporaneous net income figures. However, no operating cash flow values are provided for the 2023–2026 period, so a current earnings‑vs‑cash assessment cannot be made from this dataset. The most recent Net Income (TTM) observed was $1.51B (period end 2026-01-30). The most recent Operating Cash Flow (TTM) observed was $1.71B (period end 2017-05-05).
The Earnings vs. Cash Flow Gap
Reported earnings (Net Income) doesn't always reflect actual cash generation. Companies use accrual accounting, which recognizes revenue when earned and expenses when incurred—not when cash actually changes hands. This creates timing differences and opportunities for accounting discretion that can mask underlying business health.
Net Income (the "earnings" number) can be influenced by non-cash items like depreciation, stock-based compensation, and changes in accounting estimates.Operating Cash Flow, however, shows the actual cash the business generates from its core operations—a harder number to manipulate.
What to Look For
Key Insight: Companies with durable competitive advantages typically show operating cash flow that meets or exceeds net income over time, demonstrating they convert accounting profits into actual cash that can be returned to shareholders or reinvested in the business.
Measuring management's efficiency at generating profits from shareholder capital
DOLLAR GENERAL CORP's ROE has moderated in the most recent quarters, moving from 15.0% for the period ending to 17.8% for the period ending .
Over the longer history shown, ROE has been volatile: several pronounced spikes above 40–50% (notably 51.9% on , 49.4% on , and 43.6% on ) are interspersed with much lower readings (9.2% on and 9.1% on ), indicating large swings rather than a steady trend.
Since then, the series has settled into the mid-teens over the last two reported quarters. The most recent ROE for DOLLAR GENERAL CORP was 17.8% for the quarter ending .
The Gold Standard of Profitability
Return on Equity (ROE) is a powerful measure of how effectively a company's management is using the money shareholders have invested. Calculated by dividing Net Income by Shareholders' Equity, it reveals how much profit is generated for every dollar of equity capital.
A consistently high ROE (typically above 15-20%) is often the signature of a "quality" business with a durable competitive advantage. It indicates that the company can generate high returns on its own capital, which it can then reinvest at these high rates to compound value over time.
What to Look For:
How the company generates and deploys its cash
DOLLAR GENERAL CORP's financing cash flow TTM has become progressively more negative in the most recent quarters shown: the dataset records financing outflows of -$112.6M (period ending 2023-05-05), -$392.5M (2023-02-03), -$542.1M (2024-02-02) and -$783.3M (2024-05-03), indicating an expanding net cash outflow from financing activities over those reporting periods.
Operating cash flow TTM values in the provided history are consistently positive and show an upward trajectory across the earlier years in the dataset, rising from $1.05B (period ending 2012-02-03) to $1.71B (period ending 2017-05-05).
Investing cash flow TTM entries in the dataset are consistently negative, with values clustered between about -$250M and -$782.5M; the most negative investing outflow shown is -$782.5M (period ending 2020-01-31).
The dataset therefore shows persistent positive operating cash generation in the years reported, sustained negative investing cash flows across multiple periods, and larger negative financing cash flows in the most recent TTM observations.
Understanding Company Strategy
Capital allocation refers to how management decides to spend and invest the company's cash. Analyzing the three primary categories of cash flow reveals a company's true operational strategy:
What to look for: Is the company bootstrapping (funding growth solely from operating cash)? Are they borrowing to fund aggressive expansion or dividends? Or are they capital raising by issuing new shares, potentially diluting your ownership? A healthy, mature company typically generates strong operating cash, moderately invests in growth, and returns the surplus to shareholders through financing activities.
Net assets attributable to each share — the accounting floor of intrinsic value
Why Book Value per Share Matters
Book value per share is the net worth of the company — total assets minus total liabilities — divided by shares outstanding (split-adjusted). It represents the theoretical liquidation value per share if every asset were sold and every liability repaid at balance-sheet carrying values. It is the accounting foundation upon which much of equity valuation is built.
A steadily rising book value per share is one of the most reliable signals of compounding wealth creation. It means the company is retaining earnings and building net worth faster than it is returning capital or eroding it. Warren Buffett famously tracked Berkshire Hathaway's book value per share for decades as his primary measure of intrinsic value growth.
Context is essential. Asset-heavy businesses (banks, manufacturers, utilities) should be judged by book value more directly than asset-light businesses (software, consumer brands), where intangible assets like intellectual property and customer loyalty may far exceed their balance-sheet carrying values. A company trading at a large premium to book value is not necessarily overvalued — it may simply possess competitive advantages that accounting rules do not capture. Conversely, a declining book value per share — especially over multiple years — is a serious warning sign of capital destruction.
How much of the company is financed by debt versus shareholders' equity
Reading the Debt-to-Equity Ratio
The debt-to-equity (D/E) ratio compares total financial debt to shareholders' equity. A ratio of 1.0 means the company has borrowed one dollar for every dollar of equity; a ratio of 2.0 means it has borrowed twice as much as it owns. Financial leverage amplifies both returns and risk: in good times, debt turbocharges equity returns; in bad times, it accelerates losses and can threaten solvency.
Trends matter more than a single number. A rising D/E ratio can mean the company is taking on debt to fund growth — potentially value-creating if returns exceed the cost of capital. But it can also mean equity is being eroded through losses or that the business is borrowing simply to sustain operations. A falling D/E ratio generally reflects strengthening financial health: earnings are being retained, debt maturities are being paid down, or both.
Industry norms vary enormously. Capital-intensive sectors (utilities, real estate, financials) routinely carry high D/E ratios that would be alarming in, say, a technology company. Always compare against sector peers. As a rough rule of thumb, a D/E above 2× in a cyclical business warrants careful scrutiny of interest coverage and refinancing risk.
Short-term liquidity — can the company cover its near-term obligations?
Liquidity: Can the Business Pay Its Bills?
The current ratio is calculated as current assets divided by current liabilities. A ratio of 1.5 means the company has $1.50 of short-term assets — cash, receivables, inventory — for every $1.00 of obligations due within the next twelve months. It is the most direct measure of near-term financial resilience: can the business meet its obligations without needing to raise new capital or sell long-term assets at a discount?
A ratio above 1.0 is generally healthy, meaning current assets exceed current liabilities. A ratio consistently above 2.0 may indicate the company is holding excess cash or inventory that could be deployed more productively. A ratio below 1.0 is a warning sign — the company is relying on future cash generation or external financing to cover its near-term obligations, which is manageable in normal conditions but dangerous during a downturn.
Trends and context matter.A declining current ratio isn't always alarming — highly efficient businesses (e.g., large retailers with reliable daily cash flows) often run leaner balance sheets intentionally. Conversely, a rapidly rising current ratio can signal slowing sales causing inventory to build, or customers taking longer to pay. Always compare the trend against industry peers and cross-reference with the cash flow statement to assess whether the business is genuinely liquid or just holding non-cash current assets.
How much the market is paying for each dollar of company earnings
Over the most recent quarters the P/E for DOLLAR GENERAL CORP has risen from 13.9x on to 17.3x on , reaching 20.9x as of . The latest three reported points show a clear upward trajectory, with the largest increase occurring between the May 2025 and January 2026 readings.
Looking further back, the P/E exhibited significant volatility in 2023 — rising to 20.8x on before falling to a trough of 10.7x on ; an earlier low of 10.7x also occurred on . The most recent P/E ratio was 20.9x.
What Is the PE Ratio?
The Price-to-Earnings (PE) ratio is one of the most widely used valuation metrics in investing. It divides the current stock price by the company's earnings per share (EPS), revealing how much investors are willing to pay for each dollar of earnings. A high PE can signal that the market expects strong future growth, while a low PE may suggest undervaluation—or reflect genuine concerns about the company's prospects.
Context matters:PE ratios vary significantly across industries. High-growth technology companies routinely trade at PE ratios above 30x or 40x, while mature, low-growth sectors like utilities or financials often trade closer to 10–15x. Always compare a company's PE to its own history and its industry peers, not just an absolute number.
What to Look For:
Key Insight:The PE ratio is a snapshot of market sentiment and expectations. Tracking it over time alongside earnings trends reveals whether the market's valuation has expanded or contracted—and whether that change is justified by fundamentals.