Intrinsic value of Dollar General - DG

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$69.75

  Intrinsic Value

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  Value-price divergence*

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*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of DG stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2017), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 18.3

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2017(a)
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046
   2047

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  7.94
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
  5.00
Revenue, $m
  21,987
  21,387
  22,457
  23,580
  24,759
  25,997
  27,296
  28,661
  30,094
  31,599
  33,179
  34,838
  36,580
  38,409
  40,329
  42,346
  44,463
  46,686
  49,020
  51,471
  54,045
  56,747
  59,585
  62,564
  65,692
  68,977
  72,425
  76,047
  79,849
  83,842
  88,034
Variable operating expenses, $m
 
  18,863
  19,785
  20,752
  21,768
  22,835
  23,955
  25,131
  26,366
  27,663
  29,024
  30,020
  31,521
  33,097
  34,752
  36,489
  38,314
  40,229
  42,241
  44,353
  46,570
  48,899
  51,344
  53,911
  56,607
  59,437
  62,409
  65,529
  68,806
  72,246
  75,858
Fixed operating expenses, $m
 
  468
  480
  492
  504
  517
  530
  543
  557
  571
  585
  600
  615
  630
  646
  662
  678
  695
  713
  731
  749
  768
  787
  806
  827
  847
  868
  890
  912
  935
  959
Total operating expenses, $m
  19,923
  19,331
  20,265
  21,244
  22,272
  23,352
  24,485
  25,674
  26,923
  28,234
  29,609
  30,620
  32,136
  33,727
  35,398
  37,151
  38,992
  40,924
  42,954
  45,084
  47,319
  49,667
  52,131
  54,717
  57,434
  60,284
  63,277
  66,419
  69,718
  73,181
  76,817
Operating income, $m
  2,063
  2,056
  2,192
  2,335
  2,486
  2,644
  2,811
  2,987
  3,171
  3,366
  3,570
  4,219
  4,444
  4,682
  4,932
  5,195
  5,471
  5,761
  6,067
  6,388
  6,726
  7,081
  7,454
  7,846
  8,259
  8,692
  9,148
  9,627
  10,131
  10,660
  11,217
EBITDA, $m
  2,443
  2,652
  2,796
  2,948
  3,108
  3,276
  3,452
  3,638
  3,834
  4,039
  4,256
  4,483
  4,722
  4,974
  5,238
  5,516
  5,808
  6,116
  6,439
  6,779
  7,136
  7,511
  7,906
  8,321
  8,757
  9,216
  9,698
  10,205
  10,737
  11,297
  11,885
Interest expense (income), $m
  93
  104
  114
  125
  137
  148
  161
  174
  188
  202
  218
  234
  250
  268
  286
  306
  326
  348
  370
  394
  419
  445
  472
  501
  531
  562
  595
  630
  667
  705
  746
Earnings before tax, $m
  1,966
  1,952
  2,077
  2,210
  2,349
  2,496
  2,650
  2,813
  2,983
  3,163
  3,352
  3,985
  4,194
  4,414
  4,645
  4,889
  5,145
  5,414
  5,697
  5,994
  6,307
  6,636
  6,982
  7,346
  7,728
  8,130
  8,553
  8,997
  9,464
  9,955
  10,471
Tax expense, $m
  715
  527
  561
  597
  634
  674
  716
  759
  806
  854
  905
  1,076
  1,132
  1,192
  1,254
  1,320
  1,389
  1,462
  1,538
  1,618
  1,703
  1,792
  1,885
  1,983
  2,087
  2,195
  2,309
  2,429
  2,555
  2,688
  2,827
Net income, $m
  1,251
  1,425
  1,516
  1,613
  1,715
  1,822
  1,935
  2,053
  2,178
  2,309
  2,447
  2,909
  3,062
  3,222
  3,391
  3,569
  3,756
  3,952
  4,159
  4,376
  4,604
  4,844
  5,097
  5,362
  5,642
  5,935
  6,243
  6,568
  6,909
  7,267
  7,644

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  188
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  11,672
  11,655
  12,238
  12,850
  13,492
  14,167
  14,875
  15,619
  16,400
  17,220
  18,081
  18,985
  19,934
  20,931
  21,978
  23,077
  24,231
  25,442
  26,714
  28,050
  29,452
  30,925
  32,471
  34,095
  35,799
  37,589
  39,469
  41,442
  43,515
  45,690
  47,975
Adjusted assets (=assets-cash), $m
  11,484
  11,655
  12,238
  12,850
  13,492
  14,167
  14,875
  15,619
  16,400
  17,220
  18,081
  18,985
  19,934
  20,931
  21,978
  23,077
  24,231
  25,442
  26,714
  28,050
  29,452
  30,925
  32,471
  34,095
  35,799
  37,589
  39,469
  41,442
  43,515
  45,690
  47,975
Revenue / Adjusted assets
  1.915
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
  1.835
Average production assets, $m
  3,550
  3,572
  3,750
  3,938
  4,135
  4,341
  4,559
  4,786
  5,026
  5,277
  5,541
  5,818
  6,109
  6,414
  6,735
  7,072
  7,425
  7,797
  8,186
  8,596
  9,026
  9,477
  9,951
  10,448
  10,971
  11,519
  12,095
  12,700
  13,335
  14,002
  14,702
Working capital, $m
  1,055
  1,347
  1,415
  1,486
  1,560
  1,638
  1,720
  1,806
  1,896
  1,991
  2,090
  2,195
  2,305
  2,420
  2,541
  2,668
  2,801
  2,941
  3,088
  3,243
  3,405
  3,575
  3,754
  3,942
  4,139
  4,346
  4,563
  4,791
  5,030
  5,282
  5,546
Total debt, $m
  3,212
  3,268
  3,577
  3,901
  4,242
  4,600
  4,975
  5,369
  5,783
  6,218
  6,674
  7,153
  7,656
  8,185
  8,739
  9,322
  9,933
  10,575
  11,249
  11,957
  12,701
  13,481
  14,301
  15,161
  16,065
  17,013
  18,010
  19,055
  20,154
  21,307
  22,518
Total liabilities, $m
  6,266
  6,177
  6,486
  6,810
  7,151
  7,509
  7,884
  8,278
  8,692
  9,127
  9,583
  10,062
  10,565
  11,094
  11,648
  12,231
  12,842
  13,484
  14,158
  14,866
  15,610
  16,390
  17,210
  18,070
  18,974
  19,922
  20,919
  21,964
  23,063
  24,216
  25,427
Total equity, $m
  5,406
  5,478
  5,752
  6,039
  6,341
  6,659
  6,991
  7,341
  7,708
  8,093
  8,498
  8,923
  9,369
  9,838
  10,330
  10,846
  11,388
  11,958
  12,556
  13,183
  13,843
  14,535
  15,261
  16,025
  16,826
  17,667
  18,550
  19,478
  20,452
  21,474
  22,548
Total liabilities and equity, $m
  11,672
  11,655
  12,238
  12,849
  13,492
  14,168
  14,875
  15,619
  16,400
  17,220
  18,081
  18,985
  19,934
  20,932
  21,978
  23,077
  24,230
  25,442
  26,714
  28,049
  29,453
  30,925
  32,471
  34,095
  35,800
  37,589
  39,469
  41,442
  43,515
  45,690
  47,975
Debt-to-equity ratio
  0.594
  0.600
  0.620
  0.650
  0.670
  0.690
  0.710
  0.730
  0.750
  0.770
  0.790
  0.800
  0.820
  0.830
  0.850
  0.860
  0.870
  0.880
  0.900
  0.910
  0.920
  0.930
  0.940
  0.950
  0.950
  0.960
  0.970
  0.980
  0.990
  0.990
  1.000
Adjusted equity ratio
  0.454
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470
  0.470

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,251
  1,425
  1,516
  1,613
  1,715
  1,822
  1,935
  2,053
  2,178
  2,309
  2,447
  2,909
  3,062
  3,222
  3,391
  3,569
  3,756
  3,952
  4,159
  4,376
  4,604
  4,844
  5,097
  5,362
  5,642
  5,935
  6,243
  6,568
  6,909
  7,267
  7,644
Depreciation, amort., depletion, $m
  380
  596
  604
  613
  622
  631
  641
  651
  662
  674
  686
  264
  278
  292
  306
  321
  338
  354
  372
  391
  410
  431
  452
  475
  499
  524
  550
  577
  606
  636
  668
Funds from operations, $m
  1,533
  2,021
  2,121
  2,226
  2,337
  2,453
  2,576
  2,705
  2,840
  2,983
  3,133
  3,173
  3,339
  3,514
  3,697
  3,890
  4,093
  4,306
  4,531
  4,767
  5,014
  5,275
  5,549
  5,837
  6,140
  6,459
  6,793
  7,145
  7,515
  7,903
  8,312
Change in working capital, $m
  -72
  64
  67
  71
  74
  78
  82
  86
  90
  95
  100
  105
  110
  115
  121
  127
  133
  140
  147
  154
  162
  170
  179
  188
  197
  207
  217
  228
  240
  252
  264
Cash from operations, $m
  1,605
  2,030
  2,053
  2,155
  2,263
  2,375
  2,494
  2,619
  2,750
  2,888
  3,033
  3,069
  3,230
  3,399
  3,576
  3,763
  3,960
  4,166
  4,384
  4,612
  4,852
  5,105
  5,370
  5,650
  5,943
  6,252
  6,576
  6,917
  7,275
  7,652
  8,048
Maintenance CAPEX, $m
  0
  -154
  -162
  -170
  -179
  -188
  -197
  -207
  -218
  -228
  -240
  -252
  -264
  -278
  -292
  -306
  -321
  -338
  -354
  -372
  -391
  -410
  -431
  -452
  -475
  -499
  -524
  -550
  -577
  -606
  -636
New CAPEX, $m
  -560
  -180
  -179
  -188
  -197
  -207
  -217
  -228
  -239
  -251
  -264
  -277
  -291
  -305
  -321
  -337
  -354
  -371
  -390
  -409
  -430
  -451
  -474
  -498
  -522
  -549
  -576
  -605
  -635
  -667
  -700
Cash from investing activities, $m
  -551
  -334
  -341
  -358
  -376
  -395
  -414
  -435
  -457
  -479
  -504
  -529
  -555
  -583
  -613
  -643
  -675
  -709
  -744
  -781
  -821
  -861
  -905
  -950
  -997
  -1,048
  -1,100
  -1,155
  -1,212
  -1,273
  -1,336
Free cash flow, $m
  1,054
  1,696
  1,713
  1,797
  1,887
  1,981
  2,080
  2,184
  2,293
  2,408
  2,530
  2,540
  2,674
  2,815
  2,964
  3,120
  3,285
  3,458
  3,639
  3,831
  4,032
  4,243
  4,466
  4,700
  4,946
  5,204
  5,476
  5,762
  6,063
  6,379
  6,711
Issuance/(repayment) of debt, $m
  236
  298
  309
  324
  341
  358
  375
  394
  414
  435
  456
  479
  503
  528
  555
  582
  612
  642
  674
  708
  743
  780
  820
  860
  904
  949
  996
  1,046
  1,098
  1,153
  1,211
Issuance/(repurchase) of shares, $m
  -990
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  -743
  298
  309
  324
  341
  358
  375
  394
  414
  435
  456
  479
  503
  528
  555
  582
  612
  642
  674
  708
  743
  780
  820
  860
  904
  949
  996
  1,046
  1,098
  1,153
  1,211
Total cash flow (excl. dividends), $m
  311
  1,994
  2,021
  2,122
  2,227
  2,338
  2,455
  2,578
  2,707
  2,843
  2,986
  3,019
  3,177
  3,344
  3,519
  3,703
  3,896
  4,100
  4,314
  4,539
  4,775
  5,024
  5,285
  5,560
  5,849
  6,153
  6,473
  6,808
  7,161
  7,532
  7,922
Retained Cash Flow (-), $m
  -28
  -257
  -274
  -288
  -302
  -317
  -333
  -350
  -367
  -385
  -405
  -425
  -446
  -468
  -492
  -516
  -542
  -569
  -598
  -628
  -659
  -692
  -727
  -763
  -801
  -841
  -883
  -928
  -974
  -1,023
  -1,074
Prev. year cash balance distribution, $m
 
  157
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  1,894
  1,748
  1,834
  1,925
  2,021
  2,122
  2,228
  2,340
  2,458
  2,581
  2,594
  2,731
  2,875
  3,027
  3,186
  3,354
  3,530
  3,716
  3,911
  4,116
  4,332
  4,559
  4,797
  5,048
  5,312
  5,589
  5,881
  6,187
  6,510
  6,848
Discount rate, %
 
  4.80
  5.04
  5.29
  5.56
  5.83
  6.13
  6.43
  6.75
  7.09
  7.45
  7.82
  8.21
  8.62
  9.05
  9.50
  9.98
  10.48
  11.00
  11.55
  12.13
  12.74
  13.37
  14.04
  14.74
  15.48
  16.25
  17.07
  17.92
  18.82
  19.76
PV of cash for distribution, $m
 
  1,807
  1,584
  1,571
  1,551
  1,522
  1,485
  1,440
  1,387
  1,326
  1,259
  1,133
  1,060
  981
  900
  816
  732
  649
  568
  490
  417
  349
  288
  234
  186
  145
  111
  83
  61
  44
  31
Current shareholders' claim on cash, %
  100
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

Dollar General Corporation, a discount retailer, provides various merchandise products in the southern, southwestern, midwestern, and eastern United States. The company offers consumable products, including paper and cleaning products comprising paper towels, bath tissues, paper dinnerware, trash and storage bags, and laundry and other home cleaning supplies; packaged food products, such as cereals, canned soups and vegetables, condiments, spices, sugar, and flour; perishables consisting of milk, eggs, bread, frozen meals, beer, and wine; snacks that comprise candies, cookies, crackers, salty snacks, and carbonated beverages; health and beauty products, such as over-the-counter medicines, as well as soap, body wash, shampoo, dental hygiene, and foot care products; pet products, which include pet supplies and pet food; and tobacco products. It also provides seasonal products, including decorations, toys, batteries, small electronics, greeting cards, stationery products, prepaid phones and accessories, gardening supplies, hardware products, and automotive and home office supplies; and home products consisting of kitchen supplies, cookware, small appliances, light bulbs, storage containers, frames, candles, craft supplies and kitchen products, beds, and bath soft goods. In addition, the company offers apparel for infants, toddlers, girls, boys, women, and men, as well as socks, underwear, disposable diapers, shoes, and accessories. As of October 28, 2016, it operated 13,205 stores located in 43 states. The company was formerly known as J.L. Turner & Son, Inc. and changed its name to Dollar General Corporation in 1968. Dollar General Corporation was founded in 1939 and is based in Goodlettsville, Tennessee.

FINANCIAL RATIOS  of  Dollar General (DG)

Valuation Ratios
P/E Ratio 15.3
Price to Sales 0.9
Price to Book 3.6
Price to Tangible Book
Price to Cash Flow 12
Price to Free Cash Flow 18.4
Growth Rates
Sales Growth Rate 7.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 10.9%
Cap. Spend. - 3 Yr. Gr. Rate 0.8%
Financial Strength
Quick Ratio 0
Current Ratio 0
LT Debt to Equity 50.1%
Total Debt to Equity 59.4%
Interest Coverage 22
Management Effectiveness
Return On Assets 11.4%
Ret/ On Assets - 3 Yr. Avg. 10.8%
Return On Total Capital 14.7%
Ret/ On T. Cap. - 3 Yr. Avg. 13.8%
Return On Equity 23.2%
Return On Equity - 3 Yr. Avg. 21.1%
Asset Turnover 1.9
Profitability Ratios
Gross Margin 30.9%
Gross Margin - 3 Yr. Avg. 30.8%
EBITDA Margin 11.1%
EBITDA Margin - 3 Yr. Avg. 11.1%
Operating Margin 9.4%
Oper. Margin - 3 Yr. Avg. 9.4%
Pre-Tax Margin 8.9%
Pre-Tax Margin - 3 Yr. Avg. 9%
Net Profit Margin 5.7%
Net Profit Margin - 3 Yr. Avg. 5.7%
Effective Tax Rate 36.4%
Eff/ Tax Rate - 3 Yr. Avg. 36.7%
Payout Ratio 22.5%

DG stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the DG stock intrinsic value calculation we used $20369 million for the last fiscal year's total revenue generated by Dollar General. The default revenue input number comes from 2017 income statement of Dollar General. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our DG stock valuation model: a) initial revenue growth rate of 5% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.8%, whose default value for DG is calculated based on our internal credit rating of Dollar General, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Dollar General.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of DG stock the variable cost ratio is equal to 88.3%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $457 million in the base year in the intrinsic value calculation for DG stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 3.5% for Dollar General.

Corporate tax rate of 27% is the nominal tax rate for Dollar General. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the DG stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for DG are equal to 16.7%.

Life of production assets of 22 years is the average useful life of capital assets used in Dollar General operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for DG is equal to 6.3%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $5378 million for Dollar General - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 262.713 million for Dollar General is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Dollar General at the current share price and the inputted number of shares is $18.3 billion.


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Stock chart of DG Financial statements of DG Annual reports of DG
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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