Dollar General’s weak quarterly report and the brutal stock sell-off that followed can be blamed on retailer Walmart, according to Jim Cramer. Shares plunged more than 25% on Thursday after the discount retailer cut its full-year earnings and sales forecast. Management expects store sales to increase 1% to 1.6% in 2024, below expectations for a 2% to 2.7% increase. “While we believe the weaker sales trends are partly due to a core customer feeling financially constrained, we recognize the importance of controlling what we can control,” Dollar General CEO Todd Vasos said in a statement. Cramer argued that Walmart was able to take market share from Dollar General because Walmart increasingly offered more bargains and deals that are affordable to lower-income consumers. DG WMT YTD Berg Dollar General vs. Walmart YTD “Walmart has become a force where lower-income people are realizing that prices have come down and feel like they’re getting the lower prices every day that (founder) Sam Walton created,” Cramer said. “This return to Sam Walton’s roots … just blows everybody away.” Cramer clarified, however, that the poor results at Dollar General weren’t necessarily management’s fault, but rather a testament to the competitor’s outperformance. “The reason (DG) was a loser has nothing to do with them,” Cramer said. “Walmart has changed.” Dollar General shares are down more than 30% year-to-date, compared to Walmart’s nearly 45% rise since the start of 2024.
