Dollar Tree (DLTR) Continues to Peak

The stock for discount variety retailer Dollar Tree Inc. (DLTR) continues to reach new highs with analysts expecting better results when the company announces its earnings on May 24th. The current quarterly earnings estimates for the stock got a bump over the past 30 days from 74 cents a share to 81 cents a share compared to the same quarter last year. While the yearly estimate moved higher in the last week from $4.14 a share to $4.15 a share.

Quarterly Growth

Current quarter growth for the company is expected to come in at 22.7% while next quarter’s growth is pegged a little lower at 17.5%. With a forward price to earnings ratio (P/E) of 12.25, the stock is a little underpriced. The recent positive company expectations for competitor Big Lots (BIG) has also helped the variety discount sector as a whole. Big Lots moved from $28.85 a share to $36.09 a share over the past month on company optimism for the current quarter.

Variety Discounter Trade

Dollar Tree’s recent quarter was decent with a 6% improvement in earnings compared to what was expected. Revenue continues to climb as shoppers search for bargains in a troubled economic environment. DLTR is seeing revenue move higher 9% a quarter and 9% for the year. The discount retailing sector remains strong and should for some time providing a nice stable industry to own several names for the short-term.

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