Dollar Tree price target raised to $85 from $80 at BMO Capital

BMO Capital analyst Kelly Bania raised the firm’s price target on Dollar Tree (DLTR) to $85 from $80 but keeps a Market Perform rating on the shares. The company’s Q1 comp momentum was strong and the management raised its EPS guidance due to higher share repurchases, but incremental costs from tariffs and labor costs are weighing on Q2 estimates, suggesting a meaningful acceleration in profitability is planned in the second half of the year while implying that the management plans to more than offset incremental costs, the analyst tells investors in a research note. BMO adds that tariff mitigation strategies remain unclear and could weigh on merchandising quality longer-term.