Dollar General Corp., FCFE calculation

US$ in thousands

12 months ended:	Feb 2, 2024	Feb 3, 2023	Jan 28, 2022	Jan 29, 2021	Jan 31, 2020	Feb 1, 2019
Net income	1,661,274)	2,415,989)	2,399,232)	2,655,050)	1,712,555)	1,589,472)
Net noncash charges	1,062,513)	1,563,418)	1,024,893)	689,392)	617,093)	590,208)
Change in operating assets and liabilities	(331,989)	(1,994,852)	(558,314)	531,717)	(91,650)	(36,130)
Net cash provided by operating activities	2,391,798)	1,984,555)	2,865,811)	3,876,159)	2,237,998)	2,143,550)
Purchases of property and equipment	(1,700,222)	(1,560,582)	(1,070,460)	(1,027,963)	(784,843)	(734,380)
Proceeds from sales of property and equipment	6,199)	5,236)	4,903)	3,053)	2,358)	2,777)
Issuance of long-term obligations	1,498,260)	2,296,053)	—)	1,494,315)	—)	499,495)
Repayments of long-term obligations	(19,723)	(911,330)	(6,402)	(4,640)	(1,465)	(577,321)
Net increase (decrease) in commercial paper outstanding	(1,501,900)	1,447,600)	54,300)	(425,200)	58,300)	(63,300)
Borrowings under revolving credit facilities	500,000)	—)	—)	300,000)	—)	—)
Repayments of borrowings under revolving credit facilities	(500,000)	—)	—)	(300,000)	—)	—)
Costs associated with issuance of debt	(12,438)	(16,925)	(2,268)	(13,574)	(1,675)	(4,384)
Free cash flow to equity (FCFE)	661,974)	3,244,607)	1,845,884)	3,902,150)	1,510,673)	1,266,437)

Based on: 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-02-01).

The financial data reveals notable trends in cash flow activities over the six-year period. Operating cash flows show significant variability, with a peak observed in the fiscal year ending January 29, 2021, followed by a marked decline and partial recovery in subsequent years. Free cash flow to equity (FCFE) also fluctuates considerably, reflecting changes in cash available to shareholders after accounting for capital expenditures.

Net cash provided by operating activities: This item increased from approximately $2.14 billion in 2019 to around $2.24 billion in 2020, signifying modest growth. A substantial surge occurs in 2021, reaching nearly $3.88 billion, which represents a significant operational cash inflow increase. The year 2022 experiences a contraction to about $2.87 billion, followed by a further reduction in 2023 to roughly $1.98 billion, indicating a downward trend in operating cash generation after 2021. In 2024, there is a rebound to approximately $2.39 billion, suggesting some recovery in cash operations.
Free cash flow to equity (FCFE): FCFE shows a rising trend from about $1.27 billion in 2019 to $1.51 billion in 2020, mirroring growth in operating cash flow. The peak occurs in 2021 with a value exceeding $3.9 billion, aligning with the operational cash flow surge in the same year. However, a sharp decline follows in 2022 to roughly $1.85 billion, then an increase to about $3.24 billion in 2023, pointing to volatile free cash generation. The most recent figure in 2024 drops significantly to approximately $662 million, indicating a reduced cash return to equity holders compared to prior years.

Overall, the data reflects episodic increases and decreases in cash generation ability. The pronounced peaks in 2021 suggest exceptional operational efficiency or changes in working capital, whereas the subsequent volatility may indicate variability in capital expenditures, working capital needs, or profitability. The steep drop in FCFE in 2024 calls for close monitoring, highlighting potential challenges in sustaining free cash flow levels.

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Dollar General Corp., current P/FCFE calculation, comparison to benchmarks

No. shares of common stock outstanding	219,915,184
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in thousands)	661,974)
FCFE per share	3.01
Current share price (P)	84.03
Valuation Ratio
P/FCFE	27.92
Benchmarks
P/FCFE, Competitors¹
Costco Wholesale Corp.	72.80
Target Corp.	11.47
Walmart Inc.	67.42
P/FCFE, Sector
Consumer Staples Distribution & Retail	48.62
P/FCFE, Industry
Consumer Staples	36.89

Based on: 10-K (reporting date: 2024-02-02).

¹ Click competitor name to see calculations.

If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.

Dollar General Corp., historical P/FCFE calculation, comparison to benchmarks

	Feb 2, 2024	Feb 3, 2023	Jan 28, 2022	Jan 29, 2021	Jan 31, 2020	Feb 1, 2019
No. shares of common stock outstanding¹	219,671,316	219,108,477	228,868,368	239,264,252	251,941,312	259,518,801
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in thousands)²	661,974)	3,244,607)	1,845,884)	3,902,150)	1,510,673)	1,266,437)
FCFE per share³	3.01	14.81	8.07	16.31	6.00	4.88
Share price^1, 4	150.78	205.81	229.63	187.78	143.00	117.47
Valuation Ratio
P/FCFE⁵	50.04	13.90	28.47	11.51	23.85	24.07
Benchmarks
P/FCFE, Competitors⁶
Costco Wholesale Corp.	68.03	39.36	82.66	37.82	23.41	36.68
Target Corp.	20.84	78.41	16.84	11.15	13.90	—
Walmart Inc.	29.40	25.97	122.02	18.26	23.39	—
P/FCFE, Sector
Consumer Staples Distribution & Retail	36.91	32.19	60.47	19.63	21.92	—
P/FCFE, Industry
Consumer Staples	32.13	24.26	25.33	24.84	18.28	—

Based on: 10-K (reporting date: 2024-02-02), 10-K (reporting date: 2023-02-03), 10-K (reporting date: 2022-01-28), 10-K (reporting date: 2021-01-29), 10-K (reporting date: 2020-01-31), 10-K (reporting date: 2019-02-01).

¹ Data adjusted for splits and stock dividends.

² See details »

³ 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 661,974,000 ÷ 219,671,316 = 3.01

⁴ Closing price as at the filing date of Dollar General Corp. Annual Report.

⁵ 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= 150.78 ÷ 3.01 = 50.04

⁶ Click competitor name to see calculations.

The financial data reveals several notable trends over the examined periods.

Share Price: The share price demonstrated a strong upward trajectory from 117.47 US$ in early 2019 to a peak of 229.63 US$ in early 2022. Subsequently, there was a decline, with the price falling to 150.78 US$ by early 2024. This pattern indicates a period of significant growth followed by a moderate correction.
Free Cash Flow to Equity (FCFE) per Share: FCFE per share fluctuated substantially over the period. It increased markedly from 4.88 US$ in 2019 to a high of 16.31 US$ in early 2021, then declined sharply to 8.07 US$ in early 2022. The subsequent two years saw volatility, with FCFE rising again to 14.81 US$ in early 2023 before dropping significantly to 3.01 US$ in early 2024. This irregular pattern suggests variability in the company's ability to generate free cash flow for equity holders.
Price to FCFE (P/FCFE) Ratio: The P/FCFE ratio generally moved inversely to FCFE per share, reflecting changes in the valuation relative to free cash flow generation. The ratio stayed around the mid-20s from 2019 to early 2020, then fell sharply to 11.51 in early 2021, signaling a lower valuation multiple amid rising FCFE. However, it surged to 28.47 in early 2022 and fluctuated thereafter, reaching an elevated level of 50.04 by early 2024. The sharp increase suggests either a significant market re-rating or concerns about the sustainability of FCFE, particularly in the latest period.

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Dollar General Corp. (NYSE:DG)

Price to FCFE (P/FCFE)

Free Cash Flow to Equity (FCFE)

Price to FCFE Ratio, Current

Price to FCFE Ratio, Historical