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Dollar Tree (DLTR) Gains As Market Dips: What You Should Know
Dollar Tree (DLTR - Free Report) closed the most recent trading day at $166.29, moving +0.8% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.12%. At the same time, the Dow added 0.09%, and the tech-heavy Nasdaq gained 0.4%.
Prior to today's trading, shares of the discount retailer had lost 1.43% over the past month. This has lagged the Retail-Wholesale sector's gain of 9.21% and the S&P 500's gain of 8.25% in that time.
Dollar Tree will be looking to display strength as it nears its next earnings release. On that day, Dollar Tree is projected to report earnings of $1.57 per share, which would represent year-over-year growth of 27.64%. Meanwhile, our latest consensus estimate is calling for revenue of $6.77 billion, up 6.8% from the prior-year quarter.
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.
Investors should also note any recent changes to analyst estimates for Dollar Tree. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Dollar Tree is currently sporting a Zacks Rank of #1 (Strong Buy).
Digging into valuation, Dollar Tree currently has a Forward P/E ratio of 20.25. For comparison, its industry has an average Forward P/E of 20.25, which means Dollar Tree is trading at a no noticeable deviation to the group.
It is also worth noting that DLTR currently has a PEG ratio of 1.3. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Retail - Discount Stores stocks are, on average, holding a PEG ratio of 1.91 based on yesterday's closing prices.
The Retail - Discount Stores industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 156, putting it in the bottom 39% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.