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Dollar General (DG – 17-3/16) is a discount retailer that operates nearly 5,000 stores in the Midwestern and Southern United States. The company aims to perch its stores in small towns that are ignored by the Wal-Mart Stores (WMT – 47-3/16) of the world.
Today, DG has plunged considerably after an analyst at Goldman Sachs Group reduced her rating on the stock to a "market outperform" from a "recommend list." The stock gapped 1-15/16 points lower at the open and has not looked back. In mid-afternoon trading, the shares are off 2-3/4 points, or nearly 14 percent. By 2:00 p.m., over 2.7 million DG shares had changed hands. The average daily volume for DG over the past three months is 995,300 shares.
According to information from Zacks Online, there is room for further brokerage downgrades on the security. Presently, 18 analysts rate the stock, 16 of whom have named it a "buy" or better. Any more rating reductions would likely have negative repercussions for the shares.