Better Buy: Costco vs. Dollar General
In some respects, Costco (NASDAQ: COST) and Dollar General (NYSE: DG) represent different ends of the retail spectrum. Costco has developed a reputation for delivering high-quality items in bulk amounts at reasonable prices. Dollar General competes in what some might call the "extreme discount" sector. This subsection of retail arguably makes discounters such as Costco or Walmart appear comparatively expensive.
However, both companies have prospered by offering comparatively low prices on products to a specific segment of the market. During the COVID-19 pandemic, authorities considered them both "essential" businesses. The fact that both companies sell consumer staples allowed them to come through the recent market swoon with minimal damage.
However, investors cannot assume that these discounters offer a bargain on their stocks. Prospective buyers have flocked to these stocks over the past few years as expansions and rising sales fueled revenue and earnings growth. Now, with both companies operating stores spread across the country, investors are shopping both of these retail stocks to see which one will more likely offer a better deal. Let's take a closer look at each and see if we can determine which stock is the better buy.
Source Fool.com
