Morningstar

Dollar Tree Inc DLTR

Morningstar Rating
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Stock XNAS Rating as of
$73.12 +0.24 (0.33%)
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As of Delayed Price Closed

Company Report

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Dollar Tree's Turnaround Strategy Should Yield Improving Financial Performance Longer Term

Noah Rohr

Dollar Tree’s namesake banner boasts an impressive track record of strong top-line growth and steady margins despite operating in densely populated suburban markets where plentiful shopping alternatives exist nearby. The banner’s wide assortment of products priced at $1.25 has seemingly resonated with consumers due to its treasure hunt experience and price points that conform to shoppers operating on a tight budget.

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Price vs Fair Value

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DLTR is trading at a 220% premium.
Price
$73.12
Fair Value
$671.00
Uncertainty
High
1-Star Price
$342.70
5-Star Price
$23.90
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

The new management team brings years of experience, and its revamped capital allocation priorities, particularly surrounding the Family Dollar banner, should drive a material improvement in financial performance.

Bears

Big box retailers have increasingly looked to expand their product assortment by offering items with $1.00 price points, which could add to competitive pressure.

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News

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Trading Information

Previous Close Price
$72.88
Day Range
$72.86–74.86
52-Week Range
$60.82–151.22
Bid/Ask
$73.00 / $73.50
Market Cap
$15.72 Bil
Volume/Avg
3.7 Mil / 4.0 Mil

Key Statistics

Price/Earnings (Normalized)
13.01
Price/Sales
0.51
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Total Yield
4.13%

Company Profile

Dollar Tree operates discount stores across the United States and Canada, with over 8,600 shops under its namesake banner and nearly 7,800 under Family Dollar. About 47% of Dollar Tree’s sales in fiscal 2023 were composed of consumables (including food, health and beauty, and cleaning products), around 45% from variety items (including toys and homewares), and over 5% from seasonal items. The Dollar Tree banner sells most of its merchandise at the $1.25 price point and positions its stores in well-populated suburban markets. Conversely, Family Dollar primarily sells consumable merchandise (80% of the banner’s sales) at prices below $10. About two-thirds of Family Dollar’s stores are located in urban and suburban markets, with the remaining one-third located in rural areas.
Sector
Consumer Defensive
Industry
Discount Stores
Stock Style Box
Mid Value
Total Number of Employees
211,826
Website
https://www.dollartree.com

Competitors

Valuation

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Metric
DLTR
TGT
DG
Price/Earnings (Normalized)
 13.0116.0313.56
Price/Book Value
 2.134.982.64
Price/Sales
 0.510.670.48
Price/Cash Flow
 6.949.027.78
Price/Earnings
DLTR
TGT
DG

Financial Strength

Metric
DLTR
TGT
DG
Quick Ratio
 0.100.170.18
Current Ratio
 1.020.901.22
Interest Coverage
 −8.7814.457.03
Quick Ratio
DLTR
TGT
DG

Profitability

Metric
DLTR
TGT
DG
Return on Assets (Normalized)
 5.35%8.54%4.71%
Return on Equity (Normalized)
 15.27%35.60%21.58%
Return on Invested Capital (Normalized)
 7.19%15.59%6.80%
Return on Assets
DLTR
TGT
DG

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Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
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DfdzmplxmlZfc$71.5 Bil
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DLMAF
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DG
QhfqdgbkwYvcbcst$19.2 Bil
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—Tpl$15.7 Bil
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