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Dollar General Corporation (DG)

Company Dividend Discount ModelIndustry: Discount StoresSector: Consumer Defensive

Valuation Snapshot

Stable Growth$136.57 - $364.57$209.23
Multi-Stage$95.09 - $103.79$99.36
Blended Fair Value$154.30
Current Price$98.66
Upside56.39%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2025202420232022202120202019201820172016
DPS9.64%0.00%2.352.352.241.781.611.491.391.281.281.17
YoY Growth--0.19%4.91%25.89%10.19%8.66%6.87%8.34%0.64%8.83%0.00%
Dividend Yield--2.61%1.71%1.02%0.75%0.75%0.86%1.11%1.34%1.73%1.43%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,277.23
(-) Cash Dividends Paid (M)519.33
(=) Cash Retained (M)757.90
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)255.45159.6595.79
Cash Retained (M)757.90757.90757.90
(-) Cash Required (M)-255.45-159.65-95.79
(=) Excess Retained (M)502.45598.24662.10
(/) Shares Outstanding (M)220.49220.49220.49
(=) Excess Retained per Share2.282.713.00
LTM Dividend per Share2.362.362.36
(+) Excess Retained per Share2.282.713.00
(=) Adjusted Dividend4.635.075.36
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate5.50%6.50%7.50%
Fair Value$136.57$209.23$364.57
Upside / Downside38.42%112.07%269.52%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,277.231,360.251,448.661,542.831,643.111,749.911,802.41
Payout Ratio40.66%50.53%60.40%70.26%80.13%90.00%92.50%
Projected Dividends (M)519.33687.31874.941,084.061,316.661,574.921,667.23

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)624.18630.10636.02
Year 2 PV (M)721.60735.34749.22
Year 3 PV (M)811.94835.25859.00
Year 4 PV (M)895.58930.02965.45
Year 5 PV (M)972.851,019.841,068.63
PV of Terminal Value (M)16,938.7117,756.8618,606.32
Equity Value (M)20,964.8721,907.4222,884.63
Shares Outstanding (M)220.49220.49220.49
Fair Value$95.09$99.36$103.79
Upside / Downside-3.62%0.71%5.20%

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