Dollar Tree Inc DLTR were rising after the company reported better-than-expected earnings for the fourth quarter and reached an agreement to sell its Family Dollar business.

The company reported its results amid an exciting earnings season. Here are some key analyst takeaways.

Truist Securities On Dollar Tree

Analyst Scot Ciccarelli reiterated a Buy rating, while lifting the price target from $76 to $84.

Dollar Tree has "solid sales momentum," resulting in fourth-quarter comp of 2.0%, which was "moderately better than our 1.0%E" and was driven by 70 basis points (bps) of transaction growth and 130 bps by ticket, Ciccarelli said in a note. Management projected 3%-5% comp growth in the first quarter and the full year, "which would be higher than the majority of our universe," he added.

While the terms of separation from Family Dollar and the process of transitioning multiple systems and platforms to the cloud could impact earnings in 2025, these expenses will ease over time, the analyst stated. Dollar Tree's recent investments in DT 3.0 should "generate positive results," he further wrote.

Check out other analyst stock ratings.

Telsey Advisory Group On Dollar Tree

Analyst Joseph Feldman maintained a Market Perform rating, while raising the price target from $75 to $82.

The company's decision to sell its Family Dollar business "should help streamline operations and unlock the value of its core Dollar Tree business," Feldman said. "Dollar Tree has successfully attracted higher income households that are trading down to seek value while remaining relevant to its middle-income households by offering alternatives," he wrote.

The company plans to open around 400 new stores, representing unit growth of around 4.5%, while accruing benefits from newness in merchandising, the analyst stated. While Dollar Tree's investments in store associates and technology will increase expenses in 2025, this is "a positive step for the long term," he added.

BMO Capital Markets On Dollar Tree

Analyst Kelly Bania reaffirmed a Market Perform rating and price target of $70.

"While the sale of Family Dollar should allow management to move forward with more focus and less capex drain, the outlook now squarely falls on the performance of Dollar Tree, which we believe may have to increasingly rely on price to offset a volatile and uncertain tariff outlook," Bania wrote in a note.

Proceeds from the Family Dollar sale, the elimination of a drain on capital expenses and cash in hand could leave Dollar Tree with around $2 billion in cash when the transaction closes in June, the analyst stated. This would provide "some cushion" for the company's earnings outlook for 2025, she added.

DLTR Price Action: Shares of Dollar Tree had risen by 9.46% to $75.95 at the time of publication on Thursday.

Read More:  
• Dollar Tree To Offload Family Dollar Business For $1 Billion, Anticipates 3% To 5% Standalone Same-Store Sales Growth

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