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    Dollar Tree (DLTR) Is Up 9.5% After Raising 2025 Sales Guidance Amid Margin Pressures

    Simply Wall St·12/09/2025 11:13:14
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    • In early December 2025, Dollar Tree reported third-quarter revenue of US$4,751.0 million and net income of US$244.6 million, alongside higher earnings per share and an updated full-year sales outlook of US$19.35 billion to US$19.45 billion based on comparable store sales growth of 5.0% to 5.5%.
    • The company also continued its long-running share repurchase program, buying back about 2.82% of its shares in just four months, even as investors weighed the benefits of its multi-price strategy against fresh signs of operating margin pressure.
    • Now, we’ll explore how the raised full-year sales guidance and ongoing margin pressures might reshape Dollar Tree’s investment narrative.

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    Dollar Tree Investment Narrative Recap

    To own Dollar Tree, you need to believe its multi price strategy can keep driving healthy comparable sales while not permanently squeezing margins. The latest quarter supports the sales side, with raised full year revenue guidance, but the 40 basis point decline in operating margin keeps near term profitability the key catalyst and also the main risk. For now, the guidance upgrade helps sentiment, but does not really resolve concerns about ongoing margin pressure and cost inflation.

    The most relevant update here is the company’s new full year net sales outlook of US$19.35 billion to US$19.45 billion, built on comparable store sales growth of 5.0% to 5.5%. That guidance puts more weight on the success of Dollar Tree’s pricing and merchandising changes to keep shoppers coming, even as higher tariffs, labor costs and a more complex multi price assortment leave less room for error on margins and SG&A control.

    Yet behind the stronger sales outlook, investors should be aware of rising SG&A pressures and the risk that...

    Read the full narrative on Dollar Tree (it's free!)

    Dollar Tree's narrative projects $22.1 billion revenue and $1.4 billion earnings by 2028. This requires 6.0% yearly revenue growth and about a $0.3 billion earnings increase from $1.1 billion today.

    Uncover how Dollar Tree's forecasts yield a $107.13 fair value, a 11% downside to its current price.

    Exploring Other Perspectives

    DLTR 1-Year Stock Price Chart
    DLTR 1-Year Stock Price Chart

    Four Simply Wall St Community fair value estimates for Dollar Tree span roughly US$95 to US$115, showing how differently individual investors think about upside. When you set that against the margin compression seen alongside higher sales, it is worth weighing how much optimism you place on the company’s ability to protect profitability over time.

    Explore 4 other fair value estimates on Dollar Tree - why the stock might be worth as much as $114.82!

    Build Your Own Dollar Tree Narrative

    Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.