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Why is Dollar General (DG) Growing?
Deep discounter Dollar General (DG) is growing but making less money. Dollar General’s quarterly revenues grew by 5.05% from $9.69 billion in November 2023 to $10.18 billion in November 2024.
However, Dollar General is making less money. Its quarterly net income fell by -28.26% from $276.25 million in November 2023 to $196.53 million in November 2024. Similarly, Dollar General’s quarterly cash from operations fell by -24.17% to $542.43 million in November 2024.
Yet, Dollar General’s quarterly free cash flow grew by 31.69% to $127.82 million in November 2024. Ironically, Dollar General’s cash and short-term investments grew by 47.01% to $537.26 million in November 2024.
Thus, Dollar General has more revenue but less cash. Indeed, Google Finance estimates Dollar General’s net change in cash shrank by -5,614.8% from $12.43 million in November 2023 to $127.82 million in November 2024.
Hence, Dollar General generates less cash, which raises serious questions about its business model of operating dollar stores in second-tier markets. There seems to be more demand for Dollar General but less money for it to generate.
