Why This Is Dollar Tree’s Strongest Quarter in Years
Dollar Tree reported better than expected quarterly results before the markets opened on Tuesday.
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Dollar Tree Inc. (NASDAQ: DLTR | DLTR Price Prediction) reported fiscal third-quarter results before markets opened Tuesday. The discount retailer posted $1.39 in earnings per share (EPS) and $6.18 billion in revenue, beating the consensus estimates of $1.15 in EPS on revenue of $6.12 billion. The same period of last year reportedly had EPS of $1.08 and $5.75 billion in revenue.
Management was quick to note that Dollar Tree delivered its strongest same-store sales performance in the past 10 quarters, along with a 50-basis-point improvement in operating margin.
During the latest quarter, enterprise same-store sales increased by 5.1%. Same-store sales for the Dollar Tree segment increased 4.0%, and for the Family Dollar segment they increased by 6.4%.
In terms of segment revenues, Dollar Tree stores had $3.30 billion in revenue, an increase of 7.4% year over year. Family Dollar stores reported $2.87 billion, which was an increase of 7.5% in the same time.
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Citing uncertainty regarding COVID-19, the company did not provide any guidance. However, consensus estimates so far are calling for $1.94 in EPS and $6.69 billion in revenue for the fiscal fourth quarter.
On the books, Dollar Tree cash and cash equivalents totaled $1.12 billion at the end of the quarter, up from $539.2 million at the end of the previous fiscal year.
Also in this time, the company as a whole opened 143 new stores, expanded or relocated 34 stores and closed 16 stores.
Dollar Tree stock traded up 11.6% to $108.92 on Tuesday, in a 52-week range of $60.20 to $109.10. The consensus price target is $107.54.
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Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
