Shares of Dollar General rose Thursday after the discount retailer's quarterly earnings surpassed Wall Street expectations and the company raised its fiscal-year profit guidance.

The company reported earnings of $2.48 a share in the fiscal second quarter ended July 31, up from $1.86 a year ago and above Wall Street estimates of $2.01. Net sales grew 5.2% to $11.3 billion, just beating the analyst consensus call for $11.2 billion, according to FactSet.

The discount retailer also hiked its fiscal-year profit guidance to $7.80 to $8 a share. The company also expects net sales to grow 4% to 4.3%. The company's previous forecast was for earnings of $7.20 t0 $7.45 a share with net sales growing 3.7% to 4.2%. Wall Street expects fiscal-year earnings of $7.40, according to FactSet.

Dollar General stock rose 8.3% to $133.30 in premarket trading on Thursday after ending Wednesday up about 0.2%. Shares have slumped 7.5% this year as of the closing bell on Wednesday.

This is breaking news. Read a preview of Dollar General below and check back for more analysis soon.

Dollar General has been anything but a bargain this year.

This week's earnings report is a chance for the company to regain some lost momentum, but it must paint a more upbeat picture than Walmart presented last week. That's easier said than done.

Dollar General is in the red so far in 2026; that's in contrast to Dollar Tree, as well as its own stellar 2025 performance.

Dollar General, the larger of the two main dollar stores, has traditionally sold more essentials than discretionary items, and has struggled the most in the postpandemic years. Investors are concerned not only about the balance sheets of its lower-income shoppers, but increasing competition from the likes of Walmart.

Although it earned more than $10 a share in the 2021 to 2023 period, analysts don't expect EPS to reach double digits again until fiscal 2031.

The company has its work cut out for it: Gas prices remain high, which hits its core consumer harder than others, at the same time that Walmart has been cutting prices, putting pressure on Dollar General to do the same. The new CEO still has to win over Wall Street.

That said, expectations are already low: Not only have the shares tumbled this year, but Walmart's earnings led to that stock's worst day in years last week.

Dollar General doesn't face the same drug price headwinds as Walmart, but even accounting for that issue, the world's largest retailer's same-store sales were disappointing. Given its focus on lower-income and price sensitive shoppers, investors may worry Dollar General will face similar weakness and margin-eroding pressure to keep prices low.

And Dollar General's bottom line has beaten expectations every quarter for more than a year. (Not that that's always been enough to lift the stock.) Ongoing comparable sales momentum could be another plus.

We'll know soon enough which scenario plays out.