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Dollar Tree (DLTR) Outpaces Stock Market Gains: What You Should Know
In the latest trading session, Dollar Tree (DLTR - Free Report) closed at $168.79, marking a +1.81% move from the previous day. This move outpaced the S&P 500's daily gain of 1.5%. At the same time, the Dow added 1.12%, and the tech-heavy Nasdaq gained 0.32%.
Coming into today, shares of the discount retailer had gained 2.81% in the past month. In that same time, the Retail-Wholesale sector lost 3.84%, while the S&P 500 lost 6.54%.
Dollar Tree will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.57, up 27.64% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.77 billion, up 6.74% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $8.15 per share and revenue of $28.08 billion, which would represent changes of +40.52% and +6.69%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Dollar Tree. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.04% higher within the past month. Dollar Tree is holding a Zacks Rank of #1 (Strong Buy) right now.
In terms of valuation, Dollar Tree is currently trading at a Forward P/E ratio of 20.35. For comparison, its industry has an average Forward P/E of 20.35, which means Dollar Tree is trading at a no noticeable deviation to the group.
Meanwhile, DLTR's PEG ratio is currently 1.31. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. DLTR's industry had an average PEG ratio of 1.74 as of yesterday's close.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 217, putting it in the bottom 14% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow DLTR in the coming trading sessions, be sure to utilize Zacks.com.