Dollar General Corp. (NYSE:DG)

The financial data exhibits a series of fluctuations in key earnings metrics over the six-year period. Net income shows an overall upward momentum from 2019 through 2021, peaking in 2021 at approximately 2.65 billion US dollars. However, subsequent years reveal a decline, with 2024 figures dropping significantly to about 1.66 billion US dollars, indicating a contraction in profitability in the most recent year compared to prior peak performance.

Earnings before tax (EBT) follow a similar pattern. The metric increased steadily from around 2.02 billion in 2019 to a high of approximately 3.40 billion in 2021. Thereafter, a decline is evident with EBT falling to roughly 2.12 billion in 2024. This trend suggests that while the company was able to improve pre-tax earnings up to 2021, challenges or increased expenses thereafter have impacted taxable earnings negatively.

EBIT data also show strong growth from 2019 to 2021, rising from about 2.12 billion to nearly 3.55 billion US dollars. The subsequent years reflect a decrease coinciding with the patterns observed in net income and EBT, culminating in an EBIT of roughly 2.45 billion in 2024. This reduction in operational earnings before interest and tax points towards either increased costs or reduced operational efficiency in the latter period.

EBITDA trends mirror the overall trajectory seen in the other measures, beginning at approximately 2.57 billion US dollars in 2019 and climbing to a peak of nearly 4.13 billion in 2021. There is a downward adjustment in the following years with EBITDA at about 3.30 billion by 2024, demonstrating a decline in earnings before non-cash charges such as depreciation and amortization.

Summary of Trends

All four profitability metrics increased markedly from 2019 through 2021, indicating a period of growth and improved financial performance.

From 2022 onwards, there is a general decline across these measures, particularly pronounced in 2024, highlighting potential operational challenges, increased costs, or market conditions impacting earnings.

The declines in EBIT and EBITDA suggest that both operating efficiency and earnings capacity have weakened in recent periods.

The drop in net income relative to EBT indicates that factors post-taxation may also be contributing to reduced profitability.

Enterprise Value (EV)

The enterprise value exhibited a generally increasing trend from February 2019 through January 2022, rising from approximately 33.1 billion US dollars to a peak of about 56.4 billion US dollars. However, after this peak in early 2022, the value declined sharply in subsequent periods, dropping to nearly 39.6 billion US dollars by February 2024. This indicates a substantial reduction in market valuation or underlying factors affecting the company's overall worth during the last two years examined.

Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)

EBITDA increased significantly from roughly 2.6 billion US dollars in early 2019 to just over 4.1 billion US dollars by January 2021, indicating strong growth in operational profitability. Subsequently, EBITDA experienced a decline, falling to approximately 3.3 billion US dollars by February 2024. This downward trend following the 2021 peak signals a cooling in earnings capacity or increased operational challenges.

EV/EBITDA Ratio

The EV/EBITDA multiple fluctuated over the period, starting at about 12.9 in early 2019 and peaking at 14.6 in January 2022. This peak suggests that company valuation relative to earnings was highest at that time, potentially reflecting market optimism or higher expected growth. The ratio then decreased to about 12.0 by February 2024, implying a reduction in valuation multiples applied by investors or a reassessment of growth prospects relative to earnings.