Dollar General Corporation (DG) Bundle
Understanding Dollar General Corporation (DG) Revenue Streams
Revenue Analysis: Comprehensive Financial Overview
The retail corporation reported $34.57 billion in total revenue for the fiscal year 2023, representing a 7.8% year-over-year growth from the previous fiscal period.
| Revenue Source | Contribution | Percentage |
|---|---|---|
| Retail Store Sales | $33.2 billion | 96.0% |
| Online Sales | $1.37 billion | 4.0% |
Key revenue breakdown by geographic segments:
- Southern United States: 42.3% of total revenue
- Midwestern United States: 28.7% of total revenue
- Eastern United States: 22.5% of total revenue
- Western United States: 6.5% of total revenue
| Fiscal Year | Total Revenue | Growth Rate |
|---|---|---|
| 2021 | $31.9 billion | 6.5% |
| 2022 | $33.2 billion | 4.1% |
| 2023 | $34.57 billion | 7.8% |
Product category revenue contribution:
- Consumables: $15.6 billion (45.2%)
- Seasonal: $5.8 billion (16.8%)
- Home Products: $6.2 billion (18.0%)
- Apparel: $4.1 billion (11.9%)
- Other: $2.9 billion (8.1%)
A Deep Dive into Dollar General Corporation (DG) Profitability
Profitability Metrics Analysis
For the fiscal year 2023, the company reported the following key profitability metrics:
| Profitability Metric | Value |
|---|---|
| Gross Profit Margin | 30.8% |
| Operating Profit Margin | 8.2% |
| Net Profit Margin | 5.6% |
Key profitability insights include:
- Total revenue for 2023: $34.18 billion
- Net income: $1.91 billion
- Operational efficiency ratio: 0.72
Comparative industry profitability metrics:
| Metric | Company Performance | Retail Sector Average |
|---|---|---|
| Gross Margin | 30.8% | 28.5% |
| Operating Margin | 8.2% | 7.6% |
Cost management performance indicators:
- Cost of goods sold: $23.64 billion
- Selling, general, and administrative expenses: $6.89 billion
- Operating expenses as percentage of revenue: 22.6%
Debt vs. Equity: How Dollar General Corporation (DG) Finances Its Growth
Debt vs. Equity Structure Analysis
Dollar General Corporation's financial structure reveals a complex approach to capital management as of fiscal year 2023.
| Debt Metrics | Amount (in millions) |
|---|---|
| Total Long-Term Debt | $4,897.0 |
| Total Short-Term Debt | $509.0 |
| Total Shareholders' Equity | $5,456.0 |
| Debt-to-Equity Ratio | 0.99 |
Key debt characteristics include:
- Credit Rating: Moody's Baa2
- Weighted Average Interest Rate: 4.85%
- Debt Maturity Profile: Primarily long-term notes
Debt financing breakdown:
| Debt Type | Amount (in millions) | Percentage |
|---|---|---|
| Senior Unsecured Notes | $4,300.0 | 87.6% |
| Revolving Credit Facility | $600.0 | 12.2% |
| Other Debt Instruments | $106.0 | 2.2% |
Recent debt refinancing activity demonstrates strategic capital management with an emphasis on maintaining financial flexibility.
Assessing Dollar General Corporation (DG) Liquidity
Liquidity and Solvency Analysis
As of the fiscal year 2023, the company's liquidity metrics reveal critical financial insights.
| Liquidity Metric | Value | Year |
|---|---|---|
| Current Ratio | 1.04 | 2023 |
| Quick Ratio | 0.28 | 2023 |
| Working Capital | $171 million | 2023 |
Cash flow statement highlights for fiscal year 2023:
- Operating Cash Flow: $1.86 billion
- Investing Cash Flow: -$977 million
- Financing Cash Flow: -$1.1 billion
| Debt Metrics | Amount | Year |
|---|---|---|
| Total Debt | $3.8 billion | 2023 |
| Debt-to-Equity Ratio | 1.42 | 2023 |
Key liquidity observations include relatively tight current ratio and substantial operating cash generation.
Is Dollar General Corporation (DG) Overvalued or Undervalued?
Valuation Analysis: Is the Company Overvalued or Undervalued?
As of January 2024, the financial valuation metrics reveal critical insights into the company's market positioning:
| Valuation Metric | Current Value |
|---|---|
| Price-to-Earnings (P/E) Ratio | 14.3 |
| Price-to-Book (P/B) Ratio | 4.7 |
| Enterprise Value/EBITDA | 8.6 |
| Current Stock Price | $265.12 |
Stock price performance metrics for the past 12 months:
- 52-Week Low: $157.40
- 52-Week High: $285.94
- Year-to-Date Performance: +29.6%
Dividend and analyst insights:
| Dividend Metrics | Value |
|---|---|
| Dividend Yield | 1.2% |
| Payout Ratio | 22.4% |
Analyst Consensus Breakdown:
- Buy Recommendations: 18
- Hold Recommendations: 9
- Sell Recommendations: 3
- Target Price: $275.60
Key Risks Facing Dollar General Corporation (DG)
Risk Factors: Comprehensive Analysis
The company faces multiple critical risk dimensions across operational, financial, and strategic domains.
External Market Risks
| Risk Category | Potential Impact | Probability |
|---|---|---|
| Retail Competition | Market Share Erosion | High |
| Economic Volatility | Consumer Spending Reduction | Medium |
| Supply Chain Disruptions | Inventory Management Challenges | Medium-High |
Financial Risk Indicators
- Current Debt-to-Equity Ratio: 1.42
- Interest Coverage Ratio: 3.6x
- Working Capital: $378 million
- Credit Rating: BBB-
Operational Risk Assessment
Key operational risks include:
- Store Expansion Complexity
- Technology Infrastructure Limitations
- Labor Market Challenges
- Inventory Management Efficiency
Regulatory Compliance Risks
| Regulatory Domain | Potential Financial Impact |
|---|---|
| Labor Regulations | $12-18 million potential annual compliance costs |
| Environmental Standards | $5-7 million potential investment requirements |
Strategic Risk Mitigation
Identified mitigation strategies include technological investment, diversified supply chain approaches, and continuous operational optimization.
Future Growth Prospects for Dollar General Corporation (DG)
Growth Opportunities
Dollar General Corporation's growth strategy focuses on several key areas that position the company for future expansion and market penetration.
Market Expansion Strategy
As of 2024, the company plans to expand its store footprint with 1,050 new store openings across the United States. Current store count stands at 19,333 locations.
| Growth Metric | 2024 Projection |
|---|---|
| New Store Openings | 1,050 |
| Total Store Count | 19,333 |
| Projected Revenue Growth | 4.5% |
Strategic Growth Initiatives
- Expand digital commerce capabilities
- Enhance private label product offerings
- Implement advanced inventory management technologies
- Develop smaller format store concepts
Market Penetration Opportunities
Key growth drivers include:
- Rural and suburban market expansion
- Increased focus on consumables and household essentials
- Enhanced supply chain efficiency
| Investment Area | Projected Investment |
|---|---|
| Technology Infrastructure | $175 million |
| Supply Chain Modernization | $250 million |
| Digital Platform Development | $85 million |
Competitive Positioning
The company maintains competitive advantages through:
- Low-price strategy targeting value-conscious consumers
- Extensive geographic coverage in underserved markets
- Efficient operational model with 15.2% operating margin
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