7 Best Buy-the-Dip Stocks to Invest In

4. Dollar General Corporation (NYSE:DG)

52 Week Range: $82.68 – $168.07

Current Share Price: $83.79

Number of Hedge Fund Holders: 42

Market Capitalization as of  September 4: $18.42 Billion 

Dollar General Corporation (NYSE:DG) is one of the best buy-the-dip stocks to invest in as a consumer defensive investment play. Operating as a discount retailer, it provides consumable products, including paper, cleaning, and food items.

It is one of the retailers that has felt the full wrath of deteriorating economic conditions amid the high interest rates. The company delivered second-quarter results that fell short of expectations, with earnings of $1.70 against the expected $1.79 share. Revenues, on the other hand, totaled $10.21 billion against $10.38 billion expected.

The underperformance came as the discount retailer’s lower-income customers struggled amid the current economic conditions. The retailer is also feeling the pressure as deep-pocketed retailers double down on offering low-priced daily essentials.

Nevertheless, Dollar General Corporation (NYSE:DG) is moving to curb the losses and improve its profit margins by improving its stores and how it handles inventory. The store’s efforts to enhance its appeal are part of its plan to deal with the financial challenges affecting its clientele.

Additionally, Dollar General Corporation (NYSE:DG) is one of the companies well positioned to benefit from the US Federal Reserve cutting interest rates in September and up to 75  basis points by the end of the year. The interest rate cuts are expected to boost liquidity in the market, which should benefit most of its customers, therefore driving sales.

With the retailer trading close to its 52-week lows, it is one of the best buy dips, trading at a discount with a price-to-earnings multiple of 11. Additionally, the company comes with a 2.82% dividend yield for generating some passive income on the side.

In the second quarter, 42 hedge funds included Dollar General Corporation (NYSE:DG) in their 13F filings, with a combined stake value of $1.55 billion.