10 Worst Performing Stocks in S&P 500 in 2024

6. Dollar General Corporation (NYSE:DG)

Number of Hedge Fund Holders: 42

Year-to-Date Share Price Performance: -42.04%

Dollar General Corporation (NYSE:DG) operates as a neighborhood general store, offering affordable products and services. As of August 2024, the company has 20,345 locations in the U.S. and Mexico, including various formats like Dollar General, DG Market, DGX, pOpshelf, and Mi Súper Dollar General.

Heartland Advisors discussed Dollar General’s (NYSE:DG) performance decline in its third quarter 2024 investor letter. The firm said that it was the worst performer in the consumer staples sector this quarter, cutting its 2024 earnings guidance and reducing same-store sales and margin expectations. These challenges stem from its core customers’ financial struggles and competition from Walmart’s lower prices.

Management plans to boost promotions but believes no additional investment in staffing is necessary. The firm sold its position for tax losses but will continue monitoring the company’s fundamentals, looking for sales stabilization through promotional activities and improved cash flow management.

Dollar General (NYSE:DG) encountered difficulties in the first half of the year, especially in discretionary areas like seasonal home goods and apparel, with June outperforming July. About 60% of its sales come from households earning under $35,000, leading to low consumer sentiment among this core demographic facing financial pressures from inflation.

For 2024, the company expects ongoing promotional challenges and has lowered its EPS guidance to the range of $5.50 to $6.20. Despite these issues, Dollar General (NYSE:DG) is committed to long-term growth through new store openings and strategic investments and maintains optimism about improving customer loyalty, boosting sales, and delivering shareholder value.