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Discount stores witnessed a significant decline in foot traffic last year due to the COVID-19 pandemic. However, with substantial progress on the vaccination front, students heading back to school, and workers returning to their jobs, retail sales are increasing this year. According to an advance estimate from the U.S. Census Bureau, retail sales in September beat analysts’ expectations, despite inflationary pressures. So, discount stores offering merchandise at slashed prices should attract more customers, and both COST and DG are well-positioned to capitalize on the rebounding demand.
COST’s shares have gained 24.6% in price over the past six months, while DG has declined 1.4%. In terms of their past year’s performance, COST is again the winner with 21.1% gains versus DG’s 3.6% slump. Furthermore, COST’s 22.6% price gains year-to-date compare with DG’s 1.6% returns.
