That ROIC drag point is underrated when evaluating retail operators. Dollar General's been burning cash on store expansion but the incremental returns keep shrinking, which is a red flag most analysts gloss over when they celebrate FCF growth. I worked with a regional grocer once that had similarproblems with store density cannibalizing same-store sales, and the playbook always ends the same way when capital allocation gets sloppy. The OSHA stuff just adds operational risk on top of already questionable unit economics.
That ROIC drag point is underrated when evaluating retail operators. Dollar General's been burning cash on store expansion but the incremental returns keep shrinking, which is a red flag most analysts gloss over when they celebrate FCF growth. I worked with a regional grocer once that had similarproblems with store density cannibalizing same-store sales, and the playbook always ends the same way when capital allocation gets sloppy. The OSHA stuff just adds operational risk on top of already questionable unit economics.
Thanks for the detailed comment