12 Cheap Retail Stocks to Buy According to Hedge Funds

4. Dollar General Corporation (NYSE:DG)

Forward P/E: 12.91

Number of Hedge Fund Holders: 45

Dollar General (NYSE:DG) is a retailer that offers an elaborate array of merchandise in its stores, including home products, consumables, seasonal items, apparel, and more. Its merchandise collection includes its own private brands and brands from manufacturers.

Through fiscal Q3 2024, the business generated cash flows of $2.2 billion from operations, an increase of 52% due to improvements in Dollar General’s (NYSE:DG) working capital position, mainly through inventory management. Its net sales grew by 5% to $10.2 billion in fiscal Q3 2024. The company raised its market share in both dollars and units in highly consumable and non-consumable product sales during the quarter. Its same-store sales also rose by 1.3%, attributed to 1.1% growth in the average transaction amount, including the average unit retail price per item and the increase in average items per basket.

The company’s primary priority is investing in its business, including its existing store base and organic growth opportunities, such as strategic initiatives and new store expansion. Dollar General (NYSE:DG) has strong growth projections and estimates a 7% increase in cash flow and 11% growth in earnings annually over the coming years.