Dollar General Corporation

DG ·Consumer Cyclical, Department Stores, United States
Valuation › AI Valuation

AI Valuation

AI-generated fair value estimate for this company.

AI Fair Value $159.00
Market Price $118.94
Undervalued By 25.2%

Method: 10-year unlevered FCF DCF: $2.4B normalized FCF base (actual FY ended Jan 30, 2026 free cash flow, up 42% YoY, on $42.7B revenue, $1.51B net income); 6% annual FCF growth years 1-5 (margin recovery plus ~4.3% consensus revenue growth); 3.5% years 6-10 (mature small-box retailer); 8.5% discount rate; 2.5% terminal growth; $14.18B net debt; 220.62M diluted shares.

Reasoning: Dollar General is past the worst of its 2023-2024 margin collapse and guiding to earnings recovery, so the DCF was anchored to the latest recovering FCF rather than the prior depressed years, consistent with the margin-normalization thesis behind current sell-side price targets.