Dollar General Initiated Buy at Citigroup

Dollar General shares were initiated buy at Citi. The retailer has “proven to have a consistent model through good times and bad," says Citi analyst Paul Lejuez.
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Dollar General  (DG) - Get Report shares rose in a down Wednesday market, after Citigroup analyst Paul Lejuez began coverage of the retailer with a buy rating.

The Goodlettsville, Tenn., chain's shares have outperformed the broad market over the past three months, as consumers looked for cheap shopping options amid the massive unemployment that has resulted from the coronavirus pandemic.

Dollar General stock has eased 0.6% in the past three months, compared with a 23.4% drop for the S&P 500 index. The S&P 500 Retailing index fell 13% in that period.

The company has “proven to have a consistent model through good times and bad, and it seems that all of their initiatives are working, which should lead to continued market share gains,” Lejuez wrote in a report cited by CNBC.

He raised Citigroup’s price target for Dollar General stock to $190 a share from $184.

Dollar General said last week that it’s nearly doubling its hiring rate to add up to 50,000 employees by the end of April. Like a number of other retailers, it's hiring staff to satisfy customer demand during the pandemic.

“Our customers are relying on us now more than ever to provide an affordable, convenient retail option,” Kathy Reardon, Dollar General’s chief people officer, said in a statement.

“We invite individuals looking to start or grow a career, as well as for those whose job may be temporarily impacted by Covid-19, to apply for opportunities.”

The company has 143,000 employees and more than 16,300 stores in 45 states.

At last check, Dollar General shares traded at $155.55, up 3%.