Leading Investors Aren’t Sure What to Make of Dollar General Corp. (DG)

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Seeing as Dollar General Corp. (NYSE:DG) has witnessed flat sentiment from the entirety of the hedge funds we track, logic holds that there was also a sect of fund managers that elected to cut their full holdings in the third quarter. Intriguingly, Gregory Thomas’ Carbonado Capital dropped the largest investment of all the hedgies tracked by Insider Monkey, totaling close to $28.2 million in stock, and James Dondero’s Highland Capital Management was right behind this move, as the fund sold off about $27.7 million worth of shares. These moves are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Dollar General Corp. (NYSE:DG) but similarly valued. These stocks are Fresenius Medical Care AG & Co. (ADR) (NYSE:FMS), Vale SA (ADR) (NYSE:VALE), General Growth Properties Inc (NYSE:GGP), and The Allstate Corporation (NYSE:ALL). This group of stocks’ market valuations are similar to DG’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
FMS 6 7036 -1
VALE 27 287513 3
GGP 27 306552 7
ALL 27 1109142 -2

As you can see these stocks had an average of 21.75 hedge funds with bullish positions and the average amount invested in these stocks was $428 million. That figure was $1.17 billion in DG’s case. Vale SA (ADR) (NYSE:VALE) is the most popular stock in this table. On the other hand Fresenius Medical Care AG & Co. (ADR) (NYSE:FMS) is the least popular one with only 6 bullish hedge fund positions. Compared to these stocks Dollar General Corp. (NYSE:DG) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.

Disclosure: None

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