UPDATE: BofA Securities Downgrades Dollar General (DG) to Neutral
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BofA Securities analyst Robert Ohmes downgraded Dollar General (NYSE: DG) from Buy to Neutral with a price target of $215.00 (from $245.00).
The analyst comments "We downgrade DG to Neutral from Buy and lower our PO to $215 (was $245), which is ~20x our below consensus F23E EPS of $10.95 (was 25x our F22E) as we expect P/E multiple compression in a decelerating / negative comp environment.. We see upside to our current F4Q forecast given the +14% comp trend from F3Q end to Dec. 1, strong grocery trends through February (see Exhibit 3), and Jan. stimulus. However, we expect same store sales to inflect negatively in F1Q22 as DG begins lapping avg. ticket benefits from highly elevated Consumables inflation that occurred as industry promos declined (DG comps were +21.7% in F1Q last year)."
Shares of Dollar General closed at $192.61 yesterday.
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