The Relative Strength (RS) Rating for discount retail giant Dollar General climbed into a new percentile Monday, with a rise from 80 to 83. It stock started recovering from the recent market slump in February, earlier than most companies. Monday afternoon Dollar General stock was down fractionally.
The new 83 RS Rating means that Dollar General stock has outperformed 83% of all stocks over the past year. Market research shows that the market's biggest winners typically have an RS Rating of over 80 in the early stages of their moves.
Dollar General Big And Growing
Dollar General operates 17,688 stores nationwide and has plans to open 1,050 more. Its stock dropped to a recent low 185.15 on Feb. 24 and then turned upward, rising about 22% in the intervening weeks to trade at 228.24 Monday afternoon.
Among its other key ratings, Dollar General stock has an 84 Composite Rating, putting it in the top 16% of all stocks on a collection of five key IBD ratings. Among them is the EPS Rating. DG stock has a mild 75 EPS Rating. However, it sports an A- Accumulation/Distribution Rating, on an A+ to E scale. The A- rating indicates that mutual funds, ETFs and other institutional investors are heavy buyers of its stock.
Earnings growth last quarter slipped 2% from the same quarter a year ago, though it still posted $2.57 EPS. Revenue edged up 3% to $8.65 billion.
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Dollar General is working on a cup-without-handle pattern with a 240.24 buy point. See if the stock can clear the breakout price in heavy volume. As IBD's Industry Themes report last week noted, "Dollar General is closing in on the buy point of a cup base after reporting earnings the past week."
Dollar General earns the No. 2 rank among its peers in the Retail-Discount & Variety industry group. BJ's Wholesale Club is No. 1 in the group and Dollar Tree is No. 3.
When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength.
This unique Relative Strength Rating identifies technical performance by showing how a stock's price action over the last 52 weeks measures up against that of the other stocks in our database.
