7 Best Department Store Stocks to Buy Now

5. Dollar General Corporation (NYSE:DG)

Number of Hedge Fund Holders: 45

Dollar General (NYSE:DG) 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.

Dollar General (NYSE:DG) is operating on a profitable model. Its net sales grew by 5% to $10.2 billion in fiscal Q3 2024. The company grew its market share in both dollars and units in highly consumable products and non-consumable product sales during the quarter. Its same-store sales also rose by 1.3%, and this growth was 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 comparable sales were driven entirely by Dollar General’s (NYSE:DG) growth in the consumable category, as its customers are continually focusing on spending on essential items of need.

The company is also focusing on maintaining a mix and balance in its inventory to boost sales and improve stock levels. 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.

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. It is on track to deliver around 2,435 real estate projects this year, including 1,620 remodels, 730 new stores, and 85 relocations.