revenue
20.5–20.7 $billion
FY 2026
official guidance
DOLLAR TREE, INC.
Last · NASDAQ$121.76+5.48 (+4.71%)close · yahoo · 16h ago
Market cap$22.85B187.6M sh
P/E · TTM14.8fwd 15.4 · eps 8.21
Beta0.72vs S&P 500
Div yield0.00%annual · TTM
52w range
$85.88$142.40
Volume1.9Msession
| Revenue | $20.1B |
|---|---|
| Operating income | $2.2B |
| Net income | $1.6B |
| Free cash flow | $2.0B |
| Operating margin | 11.0% |
| Net margin | 8.0% |
| Return on equity | 47.1% |
| Period | TTM 2026-08-01 |
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OpenFilings analyst
Our analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
Strong BuyBuyHoldSellStrong Sell
Improving operating trends are offset by one-time tariff benefits and near-term margin pressure.
Dollar Tree delivered a strong Q2, with sales up 7% to $4.9 billion, comps up 3.7%, traffic turning positive at 0.4%, and adjusted EPS of $2.70.
However, $1.31 of EPS came from tariff-related benefits, while management expects Q3 adjusted EPS of only $0.80-$0.95 as $0.50 of tariff-refund reinvestment hits earnings and rising fuel, freight, inflation, and lower-margin consumables pressure margins. The operational turnaround is gaining credibility, but the underlying earnings acceleration remains insufficiently proven to justify buying after the call.
Themes
- Positive Traffic
- Multi Price
- Tariff Refunds
- Store Execution
- Freight Inflation
- Helium Shortage
Near term
Q3 sales guidance of $5.0-$5.1 billion and comparable sales growth of 3%-4% will test whether positive traffic can persist beyond the easier comparison.
Q3 adjusted EPS guidance of $0.80-$0.95 includes a $0.50 tariff-refund reinvestment headwind, making the earnings trajectory unusually noisy.
Helium supply remains constrained, with no recovery assumed in the near term and a Q2 sales impact of approximately $15 million, or 30 basis points of comp.
Fuel-driven freight costs and broad-based merchandise inflation are expected to pressure gross margin in the second half, including a year-over-year decline in Q4.
Longer term
Store execution remains the core turnaround opportunity: stores below internal standards declined from roughly 50% to about 33% of the fleet, but management acknowledged that sustaining improvements is harder than achieving them.
Multi-price penetration reached 17% of sales, up 400 basis points year over year, providing assortment and ticket flexibility; the key question is whether this can drive traffic without eroding value perception or margins.
Underlying Q2 EPS of $1.39 excluding the $1.31 tariff-related impact was above guidance, but management offered no quantified return on the approximately $210 million of planned tariff-refund reinvestment.
The company repurchased $605 million of stock in Q2 and has reduced its share count approximately 8% over 12 months, supporting per-share results but increasing the importance of genuine operating earnings growth.
Analysts pressed on whether persistent inflation and competitor price investment could prevent gross-margin recovery and undermine the 2027 earnings algorithm; management expressed confidence but provided no 2027 guidance or quantified proof.
Red flags
Q2 gross-margin expansion of 850 basis points and adjusted operating-margin expansion to 14.1% were heavily dependent on tariff benefits, including a 650 basis-point net operating-margin benefit.
Management said it had not baked any meaningful return into incremental tariff-refund spending, so the $210 million reinvestment plan currently carries uncertain payback.
Management's five margin levers were cited as the answer to fuel and inflation pressure, but the call did not quantify the offsets or establish when margins should recover.
Lower tariff rates are being used to absorb inflation and protect prices rather than flow through to earnings, while consumables growth is expected to create an unfavorable margin mix.
Positive traffic was only 0.4%, and the company declined to provide quarter-to-date comp figures, limiting visibility into whether Q2 momentum has continued.
Forward outlook
adjusted eps
7.7–8.05 $per share
FY 2026
official guidance
revenue
5–5.1 $billion
Q3 2026
official guidance
adjusted eps
0.8–0.95 $per share
Q3 2026
official guidance
OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.
From latest 10-K · 2026-03-16
- Standalone Growth
- Comparable Sales
- Multi Price Strategy
- Family Dollar Sale
- Tariff Exposure
- Margin Expansion
- Share Repurchase
- Lease Obligations
Red flags
- Tariff volatility already increased costs and created significant labor and other discrete costs related to price adjustments; management expects potentially higher costs and further implementation expenses before mitigation benefits materialize.
- SG&A increased to 28.2% of revenue, up 70 basis points year over year, limiting the benefit of the 60-basis-point gross-margin improvement.
- Lease obligations are substantial: $4.62 billion of present-value operating lease liabilities and $5.34 billion of undiscounted payments, plus $1.21 billion of right-of-use assets obtained through new leases in fiscal 2025.
- The Family Dollar disposal generated only approximately $680 million of net proceeds and required an additional $407.7 million fiscal 2025 loss after the approximately $3.4 billion fiscal 2024 write-down.
- The company repurchased $1.6 billion of stock in fiscal 2025 while maintaining $2.43 billion of long-term debt; an additional $192.7 million was spent on repurchases after year-end.