Dollar General: CEO Change Could Assuage Frustrated Investors After Tough 2023

Narrow-moat Dollar General announced the departure of Jeff Owen as CEO on Oct. 12, with his predecessor Todd Vasos returning to the role for the foreseeable future. The press release said the move was effective immediately and designed to “restore stability and confidence.” The market reacted positively to the news, with shares jumping 8% in afterhours trading. The firm also modestly lowered its fiscal 2023 financial targets, though not enough to affect our $179 fair value estimate meaningfully. We maintain our Standard Capital Allocation Rating for the name and are increasingly confident that the firm will address the most glaring underinvestment issues (as exposed in recent media reports) after the leadership change.