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Dollar Tree’s Ratings and Stock Market Performance

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Dec. 4 2020, Updated 10:42 a.m. ET

Stock market performance

Dollar Tree (DLTR) stock didn’t show much momentum even though the company met top and bottom line expectations. Dollar Tree’s share price rose marginally (0.9%) to $78.8 on May 25. Currently, Dollar Tree sits at a YTD (year-to-date) gain of 1.4%.

In comparison, Dollar General (DG) has fallen 2.4% YTD, while TJX Companies (TJX) and PriceSmart (PSMT) have risen 0.5% and 5.5%, respectively.

Supermarket players Kroger (KR) and Supervalu (SVU) have lost 14.7% and 17.6% YTD. However, big-box retailers Walmart (WMT) and Costco (COST) have risen 13% and 15.6% YTD.

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Target price and potential upside

Currently, Dollar Tree is trading ~28% below its 52-week high price. The discount retailer’s stock price will likely rise to $89.25 over the next 12 months—around 14% more than its current stock price.

Dollar General has an upside of 10%, while the stock prices of Kroger, Walmart, and Costco will likely rise 16%, 2%, and 5%, respectively.

Analysts’ recommendations

Dollar Tree is covered by 28 Wall Street analysts. They rate the company at 2.4 on a scale of 1 (strong buy) to 5 (strong sell). Dollar General is rated a 2.5, while PriceSmart and TJX Companies are rated 2.3 and 2.1, respectively.

It’s important to note that 46% of the analysts who cover Dollar Tree recommended a “hold” on the stock. Atlantic Equities and Loop Capital are among the brokers that have a “hold” recommendation on Dollar Tree.

Meanwhile, 50% of the analysts recommended a “buy” on Dollar Tree stock—compared to 40% “buy” ratings for Dollar General, 71% for Costco, and 35% for Walmart. Royal Bank of Canada and Gordon Haskett are among the brokers that gave a “buy” recommendation on Dollar Tree stock.

Investors looking for exposure to Dollar Tree through ETFs can consider the SPDR S&P Retail ETF (XRT), which invests 1% of its total holdings in the company.

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