Dollar Tree Promisingly Positioned For Long-Term Growth Despite Recent Share Decline: Analyst
Portfolio Pulse from Nabaparna Bhattacharya
BMO Capital Markets analyst Kelly Bania reiterated an Outperform rating on Dollar Tree, Inc. (DLTR) with a price target of $170. Despite a 26% fall in DLTR's share price since F2Q24, Bania sees potential for long-term growth, citing management's strategies, plans for Family Dollar, and opportunities to improve the Dollar Tree format. Bania also notes that 60% of DLTR's customers' spending still goes to Walmart Inc. (WMT). The analyst also sees potential for $2+ in EPS due to a reversal of freight headwinds and nearly $1 in one-time price investments and charges at Family Dollar.
October 06, 2023 | 6:44 pm
News sentiment analysis
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NEUTRAL IMPACT
The analyst sees potential for $2 in EPS longer-term if Family Dollar can close just half of the profitability gap to Dollar General.
The mention of Dollar General in the context of Family Dollar's profitability doesn't indicate a direct impact on Dollar General's stock. Therefore, the impact is neutral.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
NEUTRAL IMPACT
60% of Dollar Tree's customers' spending still goes to Walmart.
The mention of Walmart in the context of Dollar Tree's customer spending doesn't indicate a direct impact on Walmart's stock. Therefore, the impact is neutral.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
BMO analyst reiterates Outperform rating on Dollar Tree, sees long-term growth potential despite recent share price fall.
The analyst's positive outlook on Dollar Tree, despite its recent share price decline, could potentially boost investor confidence and positively impact the stock in the short term.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100