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Dollar Tree Likely To Lift Full-Year Outlook, Oppenheimer Says

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Dollar Tree Likely To Lift Full-Year Outlook, Oppenheimer Says

Dollar Tree (DLTR) is likely to raise its full-year outlook, with management expected to strike an upbeat tone on the business, Oppenheimer said in a Friday client note.

Oppenheimer believes the discount retailer's senior management could tweak its fiscal 2026 guidance higher to reflect potential second-quarter upside and completed share repurchases. In May, Dollar Tree said it expected adjusted EPS to come in between $6.70 and $7.10 on comparable sales growth of 3% to 4% for the ongoing fiscal year.

The brokerage estimates the company to record EPS of $7.05 in the year, up from its previous projection of $6.80, while continuing to expect same-store sales growth of 3.2%. Oppenheimer noted its forecast doesn't include any benefits related to tariff refunds, as it expects them to be fully reinvested back into the company in the form of lower prices or to mitigate inflationary headwinds from fuel.

Dollar Tree is scheduled to release its latest financial results next week.

The brokerage estimates Dollar Tree to record per-share earnings of $1.13 for the second quarter, up from its previous forecast of $1.08. In May, the retailer said it expected the metric to come in between $1 and $1.15, while the current average analyst estimate on FactSet is for $1.14.

"Investor sentiment has clearly improved toward the company's prospects, in our view," Oppenheimer analyst Rupesh Parikh wrote in the note. "As we look at the (second-quarter) fundamental setup, we expect another beat-and-raise delivery and upbeat tone from the management team."

Oppenheimer expects Dollar Tree to record comparable sales growth of 3% and believes the market's forecast of 3.1% is "achievable," as it believes the retailer will continue to benefit from its initiatives and trade-in customers. The consensus on FactSet is for same-store sales to increase by 3.2%.

Oppenheimer has a perform rating on Dollar Tree's stock. The retailer's shares were up 1.1% in Friday trading.

Walmart (WMT) on Thursday reported better-than-expected fiscal second-quarter results, although US comparable sales growth decelerated more than Wall Street projected amid a pharmacy-related headwind.

Earlier in the week, Target (TGT) lifted its full-year outlook as tariff refunds helped double the retailer's fiscal second-quarter earnings year over year. Off-price retailer TJX (TJX) also raised its full-year earnings outlook.

Price: $130.62, Change: $+2.17, Percent Change: +1.69%

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