Joseph Feldman, a top analyst from Telsey Advisory, upgraded Dollar Tree (DLTR) stock to Buy from Hold and boosted his price target to $130 from $100, ahead of the discount retailer’s Q2 earnings on September 3. The 5-star analyst’s rating upgrade was mainly driven by the introduction of multi-price point products by Dollar Tree.
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Meanwhile, Wall Street expects Dollar Tree to report earnings per share (EPS) of $0.42 for Q2 FY25, reflecting a 37% year-over-year decline. Revenue is expected to fall by more than 39% to $4.48 billion, reflecting the divestiture of the Family Dollar business.
Top Telsey Analyst Turns Bullish on DLTR Stock
Feldman stated he is “encouraged” by the early results from Dollar Tree’s rollout of multi-price point products in select categories, such as home, toys, food, and frozen and refrigerated products. He also highlighted the updated multi-price 3.0 store format.
The analyst expects a combination of these initiatives, along with an increase in the space allocated to multi-price point items in existing stores, to drive multi-year growth in Dollar Tree’s sales and profits. Feldman also expects these initiatives to help Dollar Tree gain market share and effectively manage rising costs and tariffs.
Interestingly, many analysts have raised their price targets for DLTR stock ahead of Q2 earnings. UBS analyst Michael Lasser increased his price target for Dollar Tree stock to $135 from $127 and reiterated a Buy rating. The 5-star analyst believes that Dollar Tree remains one of the best ideas in the hardline, broadline, and food retail space.
Lasser contended that while investor sentiment has improved in recent quarters, the near- and longer-term opportunity is not fully priced into Dollar Tree stock. The analyst expects upward estimate revisions and multiple expansion to drive DLTR stock higher in the near term, as the discount retailer sees accelerating comparable sales momentum.
Is DLTR Stock a Buy, Sell, or Hold?
Overall, Wall Street has a Moderate Buy consensus rating on Dollar Tree stock based on nine Buys, 10 Holds, and one Sell recommendation. The average DLTR stock price target of $113.67 indicates 3.1% upside potential.
