DLTR  Dollar Tree Inc.

Exchange

NASDAQ

Sector

Consumer Services

Industry

Department/Specialty Retail Stores

Market Cap.

16.40B

Vuru Grade

43.04/100

Current Price

$69.28
-1.61 (-2.27%)

Growth Price

$73.81
Undervalued by 6.54%

Stability Price

$39.63
Overvalued by 42.80%

Company Metrics

  • P/E 18.98
  • P/S 0.8
  • P/B 2.99
  • EPS 3.65
  • Cash ROIC 18.19%
  • Cash Ratio 0.41
  • Dividend 0 / 0%
  • Avg. Vol. 3.07M
  • Shares 236.72M
  • Market Cap. 16.40B

Company Description

Dollar Tree, Inc. operates discount variety stores in the United States. Its stores offer merchandise at the fixed price of $1.00. The company operates stores under the names of Dollar Tree, Deal$, and Dollar Bills. Its stores offer consumable merchandise, including candy and food, basic health, and beauty care; household consumables, such as paper, plastics, and household chemicals, as well as fr... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Insider Selling: Dollar Tree, Inc. (NASDAQ:DLTR) Director Sells $512072.76 in ...
BBNS - May 6, 2017
Dollar Tree logo Dollar Tree, Inc. (NASDAQ:DLTR) Director Thomas A. Saunders sold 7,444 shares of Dollar Tree stock in a transaction on Thursday, July 13th.
Which Way Traders Signposts Dollar Tree, Inc. (DLTR), Ross Stores, Inc. (ROST ... - StockNewsJournal
Dollar Tree, Inc. (DLTR) Shares Bought by CIBC World Markets Inc. - Stock Observer
Dollar Tree: Paying The Growth Premium Is Not Worth The Risk
Seeking Alpha - Jul 21, 2017
While there is little doubt that the company's low-cost merchandise business model appeals to the low-budget shopping niche, the company's high leverage due to the Family Dollar purchase and low recent returns on invested capital indicate the premium ...
3 Big Stock Charts for Tuesday: Akamai Technologies, Inc. (AKAM), Dollar Tree ... - Investorplace.com
How Does Dollar Tree, Inc. (DLTR) Stack Up Right Now? - StockNewsJournal
Buy or Sell? Average Brokerage Ratings on Dollar Tree, Inc. (DLTR), Opko ...
StockNewsJournal - 9 hours ago
ROI deals with the invested cash in the company and the return the investor realize on that money based on the net profit of the business.
Two Stocks You May Need To Reconsider: Dollar Tree, Inc. (DLTR), Opko Health ... - AllStockNews
The Concern For Dollar Tree Isn't Amazon, It's Family Dollar
Benzinga - Jun 30, 2017
"We continue to like Dollar Stores in an AMZN/WFM world but believe mediocre retail concepts will struggle if subscale and more suburban/urban," the firm said.
39015 Shares in Dollar Tree, Inc. (NASDAQ:DLTR) Acquired by Quantitative ...
Week Herald - 4 hours ago
Dollar Tree logo Quantitative Systematic Strategies LLC bought a new stake in Dollar Tree, Inc. (NASDAQ:DLTR) during the second quarter, according to its most recent filing with the Securities and Exchange Commission.
Pacific Grove Capital LP Purchases Shares of 23200 Dollar Tree, Inc. (NASDAQ:DLTR) - BNB Daily (blog)
Dollar Tree, Inc. (NASDAQ:DLTR) Trading Volume Significantly Lower - First News 24
Dollar Tree Should Sell the Biggest Acquisition It Has Ever Made, Analyst Says
TheStreet.com - Jul 10, 2017
Barclays put out a note Monday that examines the hypothetical sale of Family Dollar by Dollar Tree Inc. (DLTR) and where the stock would be trading if it sold off the unit.
Dollar Tree, Inc. (DLTR) has a Market value of 16.08 Billion - TopChronicle
What's Behind Dollar Tree's (DLTR) Recent Recovery? Find Out
Nasdaq - Jul 14, 2017
Dollar Tree Inc. DLTR seems to be gaining traction since the past one month, after the decline witnessed following the dismal earnings report in May and soft fiscal 2017 view.
Just the Facts on Dollar Tree, Inc. (DLTR) - StockNewsJournal
Should You Expect Dollar Tree Inc (DLTR) To Deliver A Superior ROE To Its ... - Simply Wall St
Why Is Dollar Tree (DLTR) Down 15.5% Since the Last Earnings Report?
Nasdaq - Jun 27, 2017
Dollar Tree posted first-quarter fiscal 2017 results, wherein quarterly adjusted earnings of $0.98 per share jumped 10.1% year over year, though it fell a penny short of the Zacks Consensus Estimate.
Will Dollar Tree Ever Get Some Value Out Of Its Family Dollar Acquisition? - Benzinga
Lookout for Price Target? Dollar Tree, Inc. (DLTR), Western Gas Partners, LP (WES)
StockNewsJournal - Jul 24, 2017
ROI deals with the invested cash in the company and the return the investor realize on that money based on the net profit of the business.
Dollar Tree - E-Commerce, Unemployment And Slowing Growth; Neutral Rating
Seeking Alpha - Jul 4, 2017
Dollar Tree is the largest dollar store chain in the United States if measured by the number of stores operated. The company's organic growth rate has slowed down as a result of lower unemployment. E-commerce is not currently a big threat but it might ...
Dollar Tree, Inc. (NASDAQ:DLTR) Position Cut by Cadence Capital Management LLC - The Cerbat Gem
As Dollar Tree INC (DLTR) Share Price Declined, Shareholder Quantitative ... - WeeklyHub
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for DLTR to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate DLTR's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$69.28 Current Price

$73.81 Growth Price (DCF)

Undervalued by 6.54%


Growth Rate Assumed by Market: 10.86%


Future Free Cash Flow Growth Rate: 13.1%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$39.63 Stability Price (EPV)

Overvalued by 42.80%


Discount Rate: 15.0%

$133.36 Book Price

Undervalued by 92.50%


Excellent Cash Return on Invested Capital over the past 5 years

DLTR has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. Annual Reports can be useful in identifying the cause of one-time events and future sustainability.

DLTR has created $18.19 of cash for every $100 invested.
Figures in USD. Fiscal year ends in January
20132014201520162017
Free Cash Flow 365.50M 463.00M 601.20M 300.40M 1.11B
divided by
Invested Capital 1.68B 1.82B 1.84B 13.07B 12.73B
Cash ROIC 21.81% 25.47% 32.65% 2.30% 8.70%

Excellent Return on Equity over the past 5 years

Over the past 5 years, DLTR has generated strong profits with money shareholders have invested. This is considered one of the best indicators of quality management. Beware of extremely high Return on Equity (> 50%) as this is often unsustainable.

DLTR has generated $28.94 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in January
20132014201520162017
Net Income 619.30M 596.70M 599.20M 282.40M 896.20M
divided by
Stockholders' Equity 1.67B 1.17B 1.79B 4.41B 5.39B
Return on Equity 37.14% 50.97% 33.57% 6.41% 16.63%

Excellent Business Performance over the past 10 years

DLTR has been able to maintain profitability in good times and bad. This could mean DLTR has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

DLTR has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Free Cash Flow 171.70M 271.80M 416.20M 340.00M 436.40M 365.50M 463.00M 601.20M 300.40M 1.11B

Weak Balance Sheet

DLTR's financial position is not ideal. The key is to check whether DLTR is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Cash 81.10M 364.40M 599.40M 486.00M 288.30M 399.90M 267.70M 864.10M 740.10M 870.40M
Current Assets 788.80M 1.07B 1.31B 1.33B 1.21B 1.47B 1.38B 1.99B 3.94B 3.94B
Total Assets 1.79B 2.04B 2.29B 2.38B 2.33B 2.75B 2.77B 3.57B 15.90B 15.70B
Current Liabilities 405.90M 409.90M 475.90M 532.80M 581.00M 676.20M 686.30M 861.60M 2.10B 2.11B
Total Liabilities 799.30M 782.50M 860.50M 921.50M 984.00M 1.08B 1.60B 1.78B 11.49B 10.31B
Stockholder' Equity 988.40M 1.25B 1.43B 1.46B 1.34B 1.67B 1.17B 1.79B 4.41B 5.39B
Current Ratio 1.94 2.62 2.74 2.50 2.08 2.18 2.01 2.31 1.88 1.87
TL-to-TA 0.45 0.38 0.38 0.39 0.42 0.39 0.58 0.50 0.72 0.66

Consistent Reinvestment of Profits over the past 10 years

DLTR has consistently retained profits. This may put DLTR in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, DLTR can greatly improve their long-term economic picture.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Retained Earnings 987.40M 1.22B 1.43B 1.46B 1.34B 1.67B 1.17B 1.77B 2.06B 2.95B
Retained Earnings Growth - 23.24% 17.57% 1.92% -7.82% 23.97% -29.50% 51.00% 15.92% 43.58%

Competitive Industry over the past 10 years

DLTR is likely operating in an industry with medium to low barriers to entry. This may mean that DLTR doesn't have a characteristic that's hard to replicate, such as exclusive distribution, branding or the ability to keep costs low. If Gross Margins are at least satisfactory, it's likely that DLTR invests heavily in R&D and Sales, General & Administrative expenses.

Only $5.90 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Net Income 201.30M 229.50M 320.50M 397.30M 488.30M 619.30M 596.70M 599.20M 282.40M 896.20M
divided by
Revenue 4.24B 4.64B 5.23B 5.88B 6.63B 7.39B 7.84B 8.60B 15.50B 20.72B
Net Profit Margin 4.74% 4.94% 6.13% 6.75% 7.36% 8.38% 7.61% 6.97% 1.82% 4.33%

Varying Pricing Power over the past 10 years

DLTR has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. However, there is a substantial variation in their Gross Profit Margins from year-to-year, which indicates inconsistent performance. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$40.73 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Gross Profit 1.46B 1.59B 1.86B 2.09B 6.63B 2.65B 2.79B 3.03B 4.66B 6.39B
divided by
Revenue 4.24B 4.64B 5.23B 5.88B 6.63B 7.39B 7.84B 8.60B 15.50B 20.72B
Gross Margin 34.44% 34.28% 35.49% 35.49% 100.00% 35.87% 35.58% 35.27% 30.05% 30.86%

High Capital Intensity over the past 10 years

DLTR spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

69.54% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Capital Expenditure 195.60M 131.30M 164.80M 178.70M 250.10M 312.20M 330.40M 325.60M 480.50M 565.60M
divided by
Net Income 201.30M 229.50M 320.50M 397.30M 488.30M 619.30M 596.70M 599.20M 282.40M 896.20M
Capital Expenditure Ratio 97.17% 57.21% 51.42% 44.98% 51.22% 50.41% 55.37% 54.34% 170.15% 63.11%

No Dividend History over the past 10 years

DLTR has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 144.60M 136.20M 135.00M 128.00M 121.20M 230.70M 219.10M 207.00M 223.50M 236.80M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 27.22 32.45 56.39 83.11 39.60 56.35 70.70 77.62 77.18 81.29
Dividend Yield - - - - - - - - - -

Strong History of Stock Buybacks over the past 10 years

DLTR has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in January
2008200920102011201220132014201520162017
Shares Outstanding 144.60M 136.20M 135.00M 128.00M 121.20M 230.70M 219.10M 207.00M 223.50M 236.80M
Stock Bought Back - 6.17% 0.89% 5.47% 5.61% -47.46% 5.29% 5.85% -7.38% -5.62%
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