04:25 PM EDT, 03/13/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We trim our 12-month target by $1 to $83, about 15x our FY 26 (Jan.) EPS of $5.50 (cut from $6.44; FY 27 initiated at $6.38) vs. the 19x long-term mean. We believe a steep discount is prudent given weak same-store sales trends and a structurally higher cost base, which have eroded margins over the past few years. We would note that operating margins were less than 5% in FY 25, down from 8%+ prior to the pandemic. DG has a goal of returning to 6% to 7% operating margins within four to five years. While attainable, it will also likely depend on macroeconomic conditions, which DG is seemingly more susceptible to given its core customers are typically low- and fixed-income households. With tariffs potentially driving higher retail prices this year, DG's core customer could see even tighter spending. EPS growth will likely be limited this fiscal year (FY 26) given wage inflation, higher depreciation, and the return of incentive compensation. However, FY 27 has the potential to return to 10%+ EPS growth.

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