Contrasting Woolworths Group (OTCMKTS:WOLWF) and Dollar General (NYSE:DG)

Dollar General (NYSE:DG) and Woolworths Group (OTCMKTS:WOLWF) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, earnings, profitability, risk and dividends.

Dividends

Dollar General pays an annual dividend of $2.36 per share and has a dividend yield of 1.9%. Woolworths Group pays an annual dividend of $1.36 per share and has a dividend yield of 4.5%. Dollar General pays out 33.4% of its earnings in the form of a dividend. Woolworths Group pays out 69.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Earnings and Valuation

This table compares Dollar General and Woolworths Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Dollar General	$42.72 billion	0.63	$1.51 billion	$7.07	17.28
Woolworths Group	N/A	N/A	N/A	$1.96	15.42

Dollar General has higher revenue and earnings than Woolworths Group. Woolworths Group is trading at a lower price-to-earnings ratio than Dollar General, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and target prices for Dollar General and Woolworths Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dollar General	1	18	10	0	2.31
Woolworths Group	1	1	0	0	1.50

Dollar General presently has a consensus price target of $130.42, indicating a potential upside of 6.73%. Woolworths Group has a consensus price target of $37.00, indicating a potential upside of 22.68%. Given Woolworths Group’s higher possible upside, analysts plainly believe Woolworths Group is more favorable than Dollar General.

Profitability

This table compares Dollar General and Woolworths Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dollar General	3.63%	18.65%	4.97%
Woolworths Group	N/A	N/A	N/A

Insider & Institutional Ownership

91.8% of Dollar General shares are held by institutional investors. Comparatively, 14.5% of Woolworths Group shares are held by institutional investors. 0.6% of Dollar General shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Dollar General beats Woolworths Group on 11 of the 13 factors compared between the two stocks.

About Dollar General

Dollar General Corporation, a discount retailer, provides various merchandise products in the southern, southwestern, midwestern, and eastern United States. It offers consumable products, including paper and cleaning products, such as paper towels, bath tissues, paper dinnerware, trash and storage bags, disinfectants, and laundry products; packaged food comprising cereals, pasta, canned soups, fruits and vegetables, condiments, spices, sugar, and flour; and perishables that include milk, eggs, bread, refrigerated and frozen food, beer, and wine. The company's consumable products also comprise snacks, such as candies, cookies, crackers, salty snacks, and carbonated beverages; health and beauty products, including over-the-counter medicines and personal care products, such as soaps, body washes, shampoos, cosmetics, and dental hygiene and foot care products; pet supplies and pet food; and tobacco products. In addition, it offers seasonal products comprising holiday items, toys, batteries, small electronics, greeting cards, stationery, prepaid phones and accessories, gardening supplies, hardware, and automotive and home office supplies; and home products that include kitchen supplies, cookware, small appliances, light bulbs, storage containers, frames, candles, craft supplies and kitchen, and bed and bath soft goods. Further, the company provides apparel, which comprise basic items for infants, toddlers, girls, boys, women, and men, as well as socks, underwear, disposable diapers, shoes, and accessories. The company was formerly known as J.L. Turner & Son, Inc. and changed its name to Dollar General Corporation in 1968. Dollar General Corporation was founded in 1939 and is based in Goodlettsville, Tennessee.

About Woolworths Group

Woolworths Group Limited operates retail stores in Australia and New Zealand. It operates through Australian Food, Australian B2B, New Zealand Food, BIG W, and Other segments. The Australian Food segment procures and resells food and related products, and provides services to customers in Australia. The Australian B2B segment engages in procurement and distribution of food and related products for resale to other businesses, as well as provision of supply chain services to business customers in Australia. The New Zealand Food segment is involved in the procurement and resale of food and drinks, and provides services to retail customers in New Zealand. BIG W segment procures and resells discount general merchandise products to customers in Australia. The Other segment operates Quantium and MyDeal retail stores The company was formerly known as Woolworths Limited and changed its name to Woolworths Group Limited in December 2017. Woolworths Group Limited was incorporated in 1924 and is based in Bella Vista, Australia.