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In the latest trading session, Dollar Tree (DLTR) closed at $72.48, marking a +1.88% move from the previous day. This move outpaced the S&P 500's daily loss of 0.29%. Elsewhere, the Dow saw a downswing of 0.32%, while the tech-heavy Nasdaq depreciated by 0.5%.
The discount retailer's stock has dropped by 6.63% in the past month, falling short of the Retail-Wholesale sector's gain of 3.53% and the S&P 500's gain of 2.52%.
The upcoming earnings release of Dollar Tree will be of great interest to investors. In that report, analysts expect Dollar Tree to post earnings of $2.18 per share. This would mark a year-over-year decline of 14.51%. At the same time, our most recent consensus estimate is projecting a revenue of $8.24 billion, reflecting a 4.61% fall from the equivalent quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $5.39 per share and revenue of $30.8 billion. These totals would mark changes of -8.49% and +0.65%, respectively, from last year.
Investors should also pay attention to any latest changes in analyst estimates for Dollar Tree. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Dollar Tree is currently a Zacks Rank #3 (Hold).
Investors should also note Dollar Tree's current valuation metrics, including its Forward P/E ratio of 13.19. This valuation marks a discount compared to its industry's average Forward P/E of 20.6.
We can also see that DLTR currently has a PEG ratio of 2.26. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Retail - Discount Stores industry currently had an average PEG ratio of 2.26 as of yesterday's close.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 28, placing it within the top 12% of over 250 industries.