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Barron's: Dollar Tree Stock Is Bargain for Investors to Buy Now

dollar tree retail store and sign.
(Ken Wolter/Dreamstime)

Monday, 12 November 2018 09:23 AM

Dollar Tree Inc.'s shares have tumbled this year, but that is exactly why the company's stock reportedly is a bargain for savvy investors.

Barron's reported that Dollar Tree's shares (DLTR.O) are as big a bargain as the $1 goods it sells in its stores, with shares off 18 percent this year. Dollar Tree shares closed Friday at $86.38, down $1.47 or 1.7 percent. The shares have hit a low of $78.78 and high of $116.65 so far this year.

Dollar Tree shares also are trading at a discount to its biggest competitor, Dollar General Corp. (DG.N), and there is a possible activist investor in the wings, Barron’s reported. Dollar General shares closed Friday at $116.10, down $1.43 or 1.2 percent. The shares have hit a low of $81.10 and high of $118.45 so far this year.

Dollar Tree, a Fortune 200 Company, now operates more than 15,000 stores across 48 states and five Canadian provinces. Stores operate under the brands of Dollar Tree, Family Dollar and Dollar Tree Canada.

Dollar Tree is trading at near a five-year low but could bounce back, Barron's said. The Chesapeake, Va.-based company has been punished for its purchase of rival Family Dollar, but has begun renovating and rebranding the struggling Family Dollar stores, Barron's said.

Barron’s said that analysts have been speculating on an activist investor may be interested. Carl Icahn and Nelson Peltz were Family Dollar shareholders who had encouraged a sale before the Dollar Tree acquisition, Barron's reported.

Meanwhile, many shoppers probably wonder: what is the real difference between Dollar General and Dollar Tree anyway?

"Despite the name, not all dollar stores sell every item in the store for just a dollar or less. Dollar Tree is a 'true' dollar store, but Dollar General is not. Even though Dollar General has the word 'dollar' in its name, everything in the store doesn’t go for a buck; their merchandise is just low priced," Reader's Digest recently explained. 

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Dollar Tree Inc.'s shares have tumbled this year, but that is exactly why the company's stock reportedly is a bargain for savvy investors.
barrons, dollar, tree, stock, bargain, investors
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2018-23-12
Monday, 12 November 2018 09:23 AM
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