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Dollar Tree
(NASDAQ:DLTR)
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Rating:73Outperform
Price Target:
$135.00
▲(27.44% Upside)
Action:Upgraded
Date:07/02/26
DLTR scores well primarily on strong technical momentum (price above key moving averages with positive MACD) and a constructive earnings-call backdrop featuring margin expansion, strong cash generation, and raised FY2026 guidance. The overall score is tempered by only mid-level financial statement strength due to uneven multi-year performance and a moderately leveraged balance sheet, while valuation (P/E 18.9) is reasonable but not a major upside driver without a dividend yield.
Positive Factors
Cash generation
Robust operating cash flow and healthy free cash flow provide durable internal funding for store investment, inventory resets and buybacks. Strong cash conversion supports capital allocation through cycles and reduces reliance on external financing over the medium term.
Negative Factors
Balance sheet leverage
Debt around low-1x equity and a historically elevated leverage profile reduce financial flexibility. In a downturn this leaves less cushion for investment or buybacks, raises refinancing risk, and forces trade-offs among capex, inventory and shareholder returns.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Robust operating cash flow and healthy free cash flow provide durable internal funding for store investment, inventory resets and buybacks. Strong cash conversion supports capital allocation through cycles and reduces reliance on external financing over the medium term.
Read all positive factors
Dollar Tree Key Performance Indicators (KPIs)
Any
Operating Income by Segment
Shows the profitability of each business segment, highlighting which areas are driving earnings and where there might be challenges or opportunities for improvement.
Shows the profitability of each business segment, highlighting which areas are driving earnings and where there might be challenges or opportunities for improvement.
Data provided by:
The Fly
The FlyDollar Tree (DLTR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$23.84B
Dividend YieldN/A
Average Volume (3M)3.87M
Price to Earnings (P/E)19.4
Beta (1Y)0.68
Revenue Growth-19.68%
EPS GrowthN/A
CountryUS
Employees153,032
SectorConsumer Defensive
Sector Strength42
IndustryDiscount Stores
Share Statistics
EPS (TTM)6.41
Shares Outstanding192,174,590
10 Day Avg. Volume2,407,349
30 Day Avg. Volume3,867,785
Financial Highlights & Ratios
PEG Ratio-0.13
Price to Book (P/B)6.44
Price to Sales (P/S)1.25
P/FCF Ratio17.32
Enterprise Value/Market Cap1.13
Enterprise Value/Revenue1.37
Enterprise Value/Gross Profit3.73
Enterprise Value/Ebitda11.30
Forecast
1Y Price Target
$123.65Price Target Upside16.73% Upside
Rating ConsensusHold
Number of Analyst Covering20
EPS Forecast (FY)6.95
Revenue Forecast (FY)$20.64B
Dollar Tree Business Overview & Revenue Model
Company Description
Dollar Tree, Inc. (DLTR) operates as a leading discount retailer, managing its extensive operations through two principal divisions: Dollar Tree and Family Dollar. The Dollar Tree segment distinguishes itself by offering all its merchandise at a c...
How the Company Makes Money
Dollar Tree makes money primarily by selling merchandise directly to consumers in its retail stores. Revenue is generated at the point of sale across major product categories, with consumables (e.g., food, snacks, beverages, household essentials, ...
Dollar Tree Earnings Call Summary
Earnings Call Date:May 28, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 20, 2026
Earnings Call Sentiment Positive
The call conveyed solid underlying momentum with strong top-line growth, significant margin expansion (gross margin +120 bps, operating margin +110 bps) and a 38% increase in adjusted EPS, supported by inventory improvement, shrink reduction and strong cash generation/repurchases. Management acknowledged persistent headwinds—traffic down 1%, higher fuel and tariff uncertainty, modest SG&A deleverage due to marketing and liability costs, and ongoing variability in store execution—but emphasized operational levers (multi-price assortment, gold store standards, targeted marketing) and a prudent, conservative outlook. On balance the positive operational and financial developments materially outweigh the challenges, though execution and macro volatility remain watch points.Positive Updates
Top-line Growth
Net sales increased 7.2% year-over-year to $5.0 billion in Q1 FY2026, driven by 3.5% comparable store sales and a 3.7% contribution from new stores.
Negative Updates
Traffic Decline
Traffic declined 1% in Q1 (though management notes a 20 basis point sequential improvement vs. Q4 and 2-year traffic acceleration), reflecting muted near-term traffic following prior pricing resets and earlier Easter timing headwind.
Read all updates
Q1-2026 Updates
Positive
Negative
Top-line Growth
Net sales increased 7.2% year-over-year to $5.0 billion in Q1 FY2026, driven by 3.5% comparable store sales and a 3.7% contribution from new stores.
Read all positive updates
Company Guidance
Management updated FY2026 guidance to net sales of $20.5–$20.7 billion with comparable-store sales growth of 3.0%–4.0% and adjusted diluted EPS of $6.70–$7.10 (outlook assumes 194 million diluted shares outstanding after share repurchases); Q2 guidance is net sales of $4.8–$4.9 billion, comp growth of 2.5%–3.5% and adjusted diluted EPS of $1.00–$1.15. The outlook assumes current tariff rates remain through July then revert to pre‑Feb‑20 levels (no tariff refunds assumed) and incorporates higher fuel costs and the benefit of a lower share count from repurchases (Q1 repurchases ~5.5M shares for $595M plus $98M subsequent). Management cited the strong Q1 start underpinning the update (Q1 net sales $5.0B, comps +3.5% with +3.7% contribution from net new stores, traffic -1%, ticket +4.5%, Q1 adjusted EPS $1.74, +38% YoY; gross margin +120 bps; adjusted operating margin 9.5% up 110 bps), noted inventory was down 9% year‑over‑year, cash of $1.0B and free cash flow of $392M, and said any future tariff refunds would likely be reinvested in the business.Dollar Tree Financial Statement Overview
Summary
Income Statement
67
Positive
Balance Sheet
58
Neutral
Cash Flow
72
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 19.75B | 19.41B | 17.58B | 16.78B | 15.41B | 26.32B |
| Gross Profit | 7.25B | 7.07B | 6.29B | 6.02B | 5.78B | 7.74B |
| EBITDA | 2.39B | 2.36B | 2.02B | 2.17B | 2.46B | 2.53B |
| Net Income | 1.29B | 1.28B | -3.03B | -998.40M | 1.62B | 1.33B |
Balance Sheet | ||||||
| Total Assets | 13.82B | 13.47B | 18.64B | 22.02B | 23.02B | 21.72B |
| Cash, Cash Equivalents and Short-Term Investments | 1.01B | 717.80M | 1.26B | 425.20M | 642.80M | 984.90M |
| Total Debt | 7.59B | 7.06B | 7.83B | 7.37B | 10.13B | 9.97B |
| Total Liabilities | 10.32B | 9.71B | 14.67B | 14.71B | 14.27B | 14.00B |
| Stockholders Equity | 3.51B | 3.75B | 3.98B | 7.31B | 8.75B | 7.72B |
Cash Flow | ||||||
| Free Cash Flow | 1.56B | 1.40B | 1.56B | 576.90M | 361.00M | 408.70M |
| Operating Cash Flow | 2.69B | 2.53B | 2.86B | 2.68B | 1.61B | 1.43B |
| Investing Cash Flow | -737.10M | -728.50M | -1.70B | -2.11B | -1.25B | -1.02B |
| Financing Cash Flow | -2.22B | -2.55B | -411.30M | -530.00M | -686.80M | -836.50M |
Dollar Tree Technical Analysis
Positive
105.93
Price Trends
104.54
Positive
109.35
Positive
110.25
Positive
Market Momentum
4.97
Negative
65.81
Neutral
81.83
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DLTR, the sentiment is Positive. The current price of 105.93 is below the 20-day moving average (MA) of 114.82, above the 50-day MA of 104.54, and below the 200-day MA of 110.25, indicating a bullish trend. The MACD of 4.97 indicates Negative momentum. The RSI at 65.81 is Neutral, neither overbought nor oversold. The STOCH value of 81.83 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DLTR.
Dollar Tree Risk Analysis
Dollar Tree disclosed 4 risk factors in its most recent earnings report. Dollar Tree reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Dollar Tree Peers Comparison
UnderperformOutperform
Sector (62)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $23.84B | 19.35 | 35.90% | ― | -19.68% | ― | |
68 Neutral | $4.49B | 18.19 | 13.49% | ― | 16.74% | 24.35% | |
62 Neutral | $20.33B | 14.63 | -3.31% | 3.23% | 1.93% | -12.26% | |
62 Neutral | $26.07B | 16.62 | 18.65% | 1.88% | 4.72% | 35.43% | |
57 Neutral | $20.32B | 44.61 | 2.50% | 3.48% | 3.91% | -50.15% | |
53 Neutral | $35.67B | 33.65 | 13.04% | 2.15% | 1.14% | -53.47% | |
51 Neutral | $6.92B | 44.16 | 8.17% | 3.49% | 3.46% | -80.55% |
* Consumer Defensive Sector Average
DLTR
Dollar Tree
124.05
22.14
21.73%
DG
Dollar General
118.17
6.33
5.66%
KR
Kroger Company
58.22
-10.18
-14.89%
TSN
Tyson Foods
58.89
3.46
6.24%
OLLI
Ollie's Bargain Outlet Holding
74.21
-56.69
-43.31%
ACI
Albertsons Companies
14.13
-7.06
-33.33%
Dollar Tree Corporate Events
Business Operations and StrategyStock Buyback
Dollar Tree Announces $2.5 Billion Share Repurchase
Positive
Jul 2, 2026
On July 1, 2026, Dollar Tree, Inc.’s Board of Directors approved a replenished share repurchase authorization totaling $2.5 billion, restoring the program to the limit previously set in July 2025. The decision follows a June 2026 block trade...
Executive/Board ChangesRegulatory Filings and ComplianceShareholder Meetings
Dollar Tree Streamlines Board and Confirms Governance Decisions
Neutral
Jun 23, 2026
On June 16, 2026, Dollar Tree amended its by-laws to reduce the size of its board of directors from eleven to ten members, reflecting an adjustment in its governance structure. The same day, shareholders elected ten directors to one-year terms, in...
Business Operations and StrategyStock BuybackFinancial Disclosures
Dollar Tree Delivers Strong Q1 2026 Earnings Growth
Positive
May 28, 2026
Dollar Tree reported first-quarter fiscal 2026 results on May 28, 2026, showing net sales up 7.2% to $5.0 billion and comparable store net sales up 3.5%, driven by higher average ticket despite slightly lower traffic. Operating income from continu...
Financial Disclosures
Dollar Tree Sets Date for Q1 2026 Earnings Release
Neutral
May 7, 2026
Dollar Tree, Inc. announced on May 7, 2026, that it will report financial results for the first quarter of fiscal 2026, which ended on May 2, 2026, before U.S. markets open on Thursday, May 28, 2026. The company will host an earnings conference ca...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.