Top 8 Discount Stores Stocks For 2025

6. Dollar General Corporation (NYSE:DG)

Dollar General Corporation is a discount retailer that offers multiple merchandise products. The company provides cleaning products, laundry products, consumable products, and other products. The company’s stock has lost over 71% of its value in just 2 years. While this is disappointing for existing shareholders, there is an opportunity here for new investors. It is unlikely that people will stop shopping for cheaper products anytime soon. So DG’s turnaround simply depends on the management pulling off a turnaround.

Inflation in the last couple of years has reduced the disposable income of low-income families, a demographic that loves to shop at DG stores. The stock is trading at just over 11 times earnings which sounds like a really good bet. To determine if that makes it a good investment or a value trap, let’s take a look at what the management is planning.

The first thing the management has done is to stop buybacks. Clearly, the management is prioritizing efficient usage of cash and long-term benefits over short-term stock appreciation. There is a clear strategy for reducing shrinkage (inventory lost to theft, errors, etc.). There is a self-checkout limit of 5 items per self-checkout while in some locations the facility has been removed completely. Other initiatives include expanding private label selections, improving store layouts, and completely remodeling older locations.

Initiatives like the above are already showing results, but it is more about the management’s intention than results at this stage. If you’re willing to back the leadership team here, the rewards could be sweet down the road.