Dollar Tree (DLTR) is breaking higher, as hoped.
In fact, as we said on Nov. 11, “U.S. consumers are showing big signs of stress again. As a result, we’re starting to see discount retailers do a bit better. After diving from a high of about $155 to $106.45, DLTR has become severely oversold.”
At the time, DLTR traded at $114.08. Today, shares of DLTR are up to $118.72 on a volume spike to 2.77 million shares. And we could easily see even more upside.
Helping, Goldman Sachs upgraded DLTR to a buy, with a $137 price target. Analysts said they “see strong earnings growth potential for the discounter supported by continued market share gains from improving traffic trends with sticky new customers, an improving discretionary cash flow outlook for lower- and middle-income consumers in 2024, and better shop-ability/in-stocks after recent investments,” as noted by Seeking Alpha.
From its current price of $118.72, we’d like to see DLTR eventually refill its gap around $140.