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Category: Dollar General (DG) and BJ's wholesale club (BJ)
Date: 28 June 2020 Stock price of Dollar General: $189.39 Stock price of BJ's Wholesale Club: $35.51 In our continued battle of the retailers series we compare Dollar General (DG) to BJ's Wholesale Club (BJ). Which of these two firms stock has had the best run over the last 3 years and which stock offers the most potential for future gains based on their current financial positions.
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While both these firms are active in the consumer retailer market in the U.S their operations are vastly different. BJ's have far fewer stores but the size of their stores are far greater than that of Dollar General "
More Dollar General (DG)
We are among the largest discount retailers in the United States by number of stores, with 16,368 stores located in 45 states as of February 28, 2020, with the greatest concentration of stores in the southern, southwestern, midwestern and eastern United States. We offer a broad selection of merchandise, including consumable items, seasonal items, home products and apparel. Our merchandise includes national brands from leading manufacturers, as well as our own private brand selections with prices at substantial discounts to national brands. We offer our customers these national brand and private brand products at everyday low prices (typically $10 or less) in our convenient small-box locations.
Quick facts of Dollar General:
Quick facts of Dollar General:
- Dollar General is listed on the New York Stock Exchange (NYSE) under share code ticker: DG
- Market capital of Dollar General (DG) : $47.7 billion
- Number of stores as at end of February 2020: 16 368
- Consumables makes up 78% of their sales
- 143 000 full time employees
- Our stores average approximately 7,400 square feet of selling space
- Net sales for fiscal 2019: $27.7 billion
- Earnings per share for fiscal 2019: $6.64
- PE ratio of Dollar General: 28.5
- Dividends per share for fiscal 2019: $1.28
- Dividend yield: 0.67%
- Stockholders equity in Dollar General: $7.209 billion
- Stockholders equity per share: $28.42
- Price to stockholders equity: 6.67
- Number of shares in issue: 258.053 million
- Net sales per square foot: $ 237
More About BJ's Wholesale Club
BJ’s Wholesale Club is a leading warehouse club operator in the Eastern United States. We deliver significant value to our members, consistently offering 25% or more savings on a representative basket of manufacturer-branded groceries compared to traditional supermarket competitors. We provide a curated assortment focused on perishable products, continuously refreshed general merchandise, gasoline and other ancillary services to deliver a differentiated shopping experience, that is further enhanced by our omnichannel capabilities. Since pioneering the warehouse club model in New England in 1984, we have grown our footprint to 217 large-format, high volume warehouse clubs spanning 17 states. In our core New England markets, which have high population density and generate a disproportionate part of U.S. GDP, we operate almost three times the number of clubs of the next largest warehouse club competitor. In addition to shopping in our clubs, members are able to shop when and how they want through our website, www.bjs.com; our highly-rated mobile app; and our integrated Instacart same-day delivery offering.
Quick facts about BJs Wholesale Club
Quick facts about BJs Wholesale Club
- BJ's Wholesale Club is listed on the NYSE under share code ticker: BJ
- BJ's Wholesale Club market capital: $5.11 billion (as at 25 June 2020)
- Number of employees of BJ's Wholesale Club: 27 200
- Revenues in 2019: $13.2 billion
- Earnings per share in 2019: $1.35
- PE ratio of BJ's Wholesale Club: 27.3
- Shares in issue: 139.1 million
- Cash on balance sheet: $30.2 million
- Stockholders equity in BJ's Wholesale Club: $32.497 million
- Stockholders equity per share: $0.23
- Price to stockholders equity: 154
- Number of BJ's Wholesale Club: 217
- Number of Club members: 5.5 million
Dollar General (DG) stock vs BJ's Wholesale (BJ) stock
The image below shows the stock price performance of Dollar General (DG) and BJ's Wholesale Club over the last 2 years (basically since BJ's Wholesale Club's listing). While both these firms are active in the consumer retailer market in the U.S their operations are vastly different. BJ's have far fewer stores but the size of their stores are far greater than that of Dollar General. Over the two year period in question it has been Dollar General that has easily outperformed the stock of BJ's Wholesale Club. Over the last two years the stock of Dollar General has returned 90.34% while the stock of BJ's Wholesale Club returned 31.65%.
So if one had to buy one of these two barista based companies stock right now who would and should you buy? Dollar General is roughly twice the size of BJ's Wholesale Club based on their revenues for their 2019 fiscal years. And Dollar General has a far greater footprint than that of BJ's Wholesale Club with far more stores across the USA. But more stores means more staff and buildings which means higher operating costs. So based on their financial results which firm is best placed to provide superior returns to investors in future?
One of our first comparison metrics is the price to stockholders equity per share ratio. And looking at that Dollar General has a ratio of 6.66 (above the norm of between 2 and 4 times) but far lower than BJ's Wholesale Club ratio of 154. Looking at other ratios such their Price to earnings ratio (PE) ratio Dollar General's PE ratio is slightly higher at 28.5 compared to BJ's Wholesale Club's PE of 27.3.
Dollar General has a dividend yield of 0.67% which is not very high, but at least they are paying a dividend, while BJ's Wholesale Club is not paying a dividend right now. Based on their footprint, their stronger stockholders equity per share position, and the fact that they are currently paying a dividend and only has a slightly higher PE ratio than BJ's wholesale club, we rate Dollar General as the winner in the battle between Dollar General and BJ's Wholesale
Dollar General has a dividend yield of 0.67% which is not very high, but at least they are paying a dividend, while BJ's Wholesale Club is not paying a dividend right now. Based on their footprint, their stronger stockholders equity per share position, and the fact that they are currently paying a dividend and only has a slightly higher PE ratio than BJ's wholesale club, we rate Dollar General as the winner in the battle between Dollar General and BJ's Wholesale