Jefferies upgraded the stock to a buy with a $79 price target Monday. The former target was $55. Morgan Stanley released a note with the same price target Monday.
Jefferies analyst Daniel Binder also upgraded Dollar General to a buy on the premise that it could purchase Family Dollar and improve its competitive position. Binder said a merger between Family Dollar and Dollar General would create between $950 million and $1.2 billion in synergies. In his note, Binder said the upgrade is based on "a potential combination of Dollar General and Family Dollar and the enormous synergies we see as a result." Family Dollar is far less interesting, he said, as a standalone company and is fairly valued at around $60 per share. At the time of publication, the author held no positions in any of the stocks mentioned. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff. >>Read More: Twitter Investors Could Still Feel More Pain As Apple Stock Gets Sliced, It's Not Time for Investors to Split Want to Make It as a Stock Analyst? Be One of These 3 Types There's No Justification for Crude Oil Prices in the Stratosphere