Shares of Dollar General (DG) may have more upside ahead, according to a top Wall Street analyst who believes the discount retailer’s margin recovery signals a stronger performance in the coming quarters. Notably, five-star analyst Michael Lasser of UBS recently reiterated his Buy rating on DG stock, emphasizing that the stock has “more room to run” as the company works through its margin challenges and returns to more consistent performance. Year-to-date, DG stock has gained over 50%.
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UBS Sticks with Bullish View on Dollar General
UBS noted that recent discussions with Dollar General had “the most positive tenor” the company has conveyed in years, pointing to a clearer path toward meaningful margin improvement. The firm also cited the retailer’s improving trajectory following a stretch of inconsistent performance.
Earlier this month, Dollar General reported its Q1 2025 results, delivering 5% year-over-year growth with revenue reaching $10.44 billion. While the company acknowledged ongoing uncertainty around potential tariff hikes and their impact on consumer behavior, it emphasized that contingency plans are in place to help navigate these risks. Notably, UBS raised its price target on DG stock from $120 to $128 following the company’s Q1 2025 results, implying an upside of nearly 12% from current levels.
Additionally, UBS highlighted that the company’s operating margin could climb to 6–7%, a significant improvement from the roughly 4.5% expected this year. The firm projected that reaching this margin target could allow Dollar General to more than double its earnings per share in the coming years, compared to the current-year guidance midpoint of $5.50.
Is Dollar General a Buy or Sell?
According to TipRanks, Wall Street has a Moderate Buy consensus rating on DG stock, based on 10 Buys and 13 Holds assigned in the last three months. The average Dollar General stock price target of $116.18 implies a modest upside of just over 1% from current levels.
