Analyst Says Dollar General Is Winning Tariff War — Should You Invest?
Written by
Vance Cariaga
Edited by
Cory Dudak
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Many retail stocks have been battered this year because of worries over how President Donald Trump’s tariff plans will impact the sector. But there have been some exceptions — including Dollar General, which has bucked the trend by producing strong financials and a surging stock price so far in 2025.
If you’re thinking about investing in the Tennessee-based discount chain, read on to learn if this is a good time.
‘Executing Better’
One analyst who’s bullish on Dollar General is BMO Capital Markets’ Kelly Bania. Earlier this month, she raised her price target to $115 from $90 while maintaining a “market perform” rating on the stock. That move came after Dollar General beat quarterly estimates for both revenue and earnings, and raised its sales and profit forecasts for the year.
Why has Dollar General outperformed expectations when so many other retailers have struggled to find their footing?
“They are just executing better,” Bania said in comments reported by ModernRetail. “When you go into stores, the in-store experience is better.”
Another Stellar Quarter
Dollar General’s better execution is reflected in its financial results. It logged fiscal first-quarter earnings of $1.78 a share, up from $1.65 the previous year and well ahead of analyst views for $1.48, CNBC reported. Revenue gained 5.3% to $10.44 billion, topping estimates for $10.31 billion. Same-store sales rose 2.4%.
Following its earnings report, Dollar General raised its outlook for earnings, net sales growth and same-store sales growth.
Meanwhile, its stock price was up by about 49% year-to-date through June 17, 2025, closing the day at $113.32 per share. That far outpaces the performances of both the S&P 500 (up 1.7%) and the Dow (down 0.77%).
Limiting China Damage
As CNBC noted, Dollar General’s outlook stands in stark contrast to retailers like Best Buy, Macy’s and Abercrombie & Fitch, which have cut their profit outlooks due to tariffs. Even Walmart has said it will raise prices due to tariffs, despite pushback from Trump.
One of Dollar General’s strategies has been to reduce its exposure to China so it can limit its price hikes, CEO Todd Vasos said in a Q1 conference call.
“While the tariff landscape remains dynamic and uncertain, we expect tariffs to result in some price increases as a last resort, though we intend to work to minimize them as much as possible,” Vanos said.
Leader of the Discount Pack
How does Dollar General compare with other discount retailers? Here’s a look at how other stocks have performed during the first half of 2025:
- Dollar Tree: up 31.2% through June 17
- Five Below: up 18%
- Walmart: up 4.3%
- Target: down 29.7%
As these performances show that fellow deep-discount chains Dollar Tree and Five Below have also produced decent stock gains in a challenging environment — but Dollar General’s increase is nearly twice as much as the next-closest rival.
As for whether you should invest in Dollar General, most Wall Street analysts expect its stock price to keep inching higher, but only by a little.
As of June 17, the average recommendation of 33 analysts cited by MarketWatch was “overweight.” The average price target was $113.50 per share, which represented a premium of about 3% over its June 17 closing price.
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