Dollar General Corp (NYSE:DG) stock is sitting out the broad market rally today, last seen down 0.3% to trade at $117.48. Despite an 11.5% year-to-date deficit and a key trendline getting breached last week, DG has seasonality on its side in April.
Dollar General is one of the best-performing stocks on the S&P 500 Index (SPX) in April, going back a decade. According to Schaeffer's Senior Quantitative Analyst Rocky White, DG averaged a 3.8% return for April in the last 10 years, with an 80% win rate. It's interesting that sector peer Dollar Tree (DLTR) is on the list as well, boasting an average 2.4% return for April with an 80% win rate.
A move of similar magnitude would have the stock reclaiming its 200-day moving average, a trendline that was support back in November. Longer term, the equity is 33.7% higher year-over-year. Keep an eye on DG's 14-Day Relative Strength Index (RSI) of 25, which is deep in "oversold" territory.
An unwinding of pessimism in the options pits could provide an added boost. The equity's 10-day put/call volume ratio of 1.14 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 87th percentile of its annual range.
