Insider Activity Report: Dollar General (DG)

Carman Wenkoff, CIO at Dollar General (DG), recently bought 2,000 shares. The buy came to a total of $212,500, and increased his holdings by 7 percent.

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  • That marks the first insider transaction at the retailer since June, when a company director bought 8,500 shares, paying just over $1.3 million. Other company insiders were buyers in June as well. Going further bank, insiders were sellers in 2022 and 2021, almost exclusively after the exercise of stock options.

    Overall, company insiders own 0.5 percent of shares.

    The retailer has shed nearly 60 percent of its price over the past year, amid fears of a slowing economy and a rise in retail thefts hitting the sector hard.

    While revenues did rise 4 percent over the past year, higher costs have led to a 30 percent drop in earnings. However, Dollar General still looks like a reasonable value here, with shares trading at 13 times earnings.

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  • Action to take: In a slowing economy, Dollar General should be able to maintain or increase its market share, which could lead to improving conditions. And an expanding economy should also lead to higher sales.

    That makes shares look like a reasonable buy should they get to the $100 range. The stock yields about 2.2 percent at today’s prices.

    For traders, shares have slid lower in recent sessions. There may be some short-term downside to the $100 range in the coming sessions. The November $100 puts, last going for about $3.55, could see mid-double-digit gains.


    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.

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