In March 2025, Dollar General saw its total shareholder returns on a strong upward trajectory, with its share price climbing 8% over the last month. This movement in the stock may reflect the market's response to the company's recent earnings announcement. Although fourth-quarter sales rose to $10.3 billion from $9.9 billion year-over-year, net income significantly declined by over 50%. The Board's decision to declare a quarterly dividend of $0.59 per share also remained consistent with shareholder-focused practices, potentially supporting stability amidst market fluctuations. Despite a broader market decline of 4.1% during the same period due to tariff concerns, Dollar General's strategic corporate guidance, projecting sales growth between 3.4% and 4.4%, could have instilled confidence among investors. This comes amid a generally cautious market outlook weighted down by inflationary and economic uncertainties. Such developments may overall have reflected positively on Dollar General's recent total shareholder returns.

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The past five years have been challenging for Dollar General, with total shareholder returns declining by 40.41%. This performance is in stark contrast to recent more optimistic outlooks. Over the same period, the company has faced significant hurdles, such as declining net profit margins, which fell from last year’s 4.3% to 2.8%. Additionally, negative earnings growth of 32.5% over the past year further highlights the difficulty Dollar General has encountered compared to the Consumer Retailing industry, which grew by 3.6%.

Despite these challenges, Dollar General has maintained sound value indicators, trading at a Price-To-Earnings Ratio of 15.6, which outshines its peer average of 27.1. Furthermore, the company's consistent quarterly dividend of US$0.59 per share demonstrates its commitment to shareholder returns, although it was not enough to offset the broader decline. The company also embarked on share repurchases, completing buybacks of 123.53 million shares for US$14.62 billion, indicating a substantial investment in its own stock, despite suspensions in late 2024 and early 2025.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NYSE:DG.

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