Track market-moving stories before they get noisy

Store closures have become a common story in 2026. While food and restaurant chains like Five Guys, Pizza Hut, and Papa John’s tend to grab most of the headlines, this year has also seen closures from retail shopping brands like H&M and Glossier.

And now, another retailer is joining that list. Discount chain Dollar Tree Inc. has announced that it plans to close around 75 stores, even as it grows its overall footprint. Here’s what you need to know.

Dollar Tree to shutter 75 locationsDollar Tree is celebrating its 40th anniversary this year. But unfortunately, its 40th will also be marked by store closures.

On May 28, Dollar Tree reported its first-quarter fiscal 2026 results, which ended on May 2. Overall, those results were healthy. The chain reported net sales of $5 billion, an increase of 7.2% over the same quarter a year earlier. Its adjusted diluted earnings per share (EPS) also grew 38.1% to $1.74.

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During the same quarter, the company also opened 113 new Dollar Tree stores, bringing its total to 9,382 stores across the U.S. and Canada.

However, the company also announced that it would be closing some locations in fiscal 2026, which ends in January. Specifically, Dollar Tree said it will close approximately 75 locations during its current fiscal year.

While that number seems high, it represents less than 1% of all Dollar Tree stores. 

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Dollar Tree Today

$122.12 -1.49 (-1.21%)

As of 02:06 PM Eastern

This is a fair market value price provided by Massive. Learn more.

52-Week Range$84.71▼

$142.40P/E Ratio19.09

Price Target$122.68

The discount retail space weathered a relentless storm over the past two years. Soaring inflation forced low-income consumers to ruthlessly prioritize essentials, while retail shrinkage and elevated logistics costs steadily eroded operating margins.

Many operators in this space found themselves trapped in a multi-quarter downtrend, punished by a market that demands immediate top-line growth. The high-volume, low-margin business model requires near-perfect execution, and any disruption in supply chains or consumer spending habits quickly translates into severe equity drawdowns. Dollar Tree, Inc. NASDAQ: DLTR is aggressively defending its valuation floor with a replenished $2.5 billion buyback and a 120-bps expansion in gross margin, defying the broader discount retail traffic slump.

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Spotting the Green Shoots EarlyWhen a retailer falls out of favor, the market prices in peak pessimism and assumes operational headwinds will persist indefinitely. Finding an entry point requires looking past the immediate noise to identify structural business shifts before they fully reflect in the share price.

Mispricing occurs when Wall Street focuses entirely on lagging metrics, such as historical foot traffic, out of caution, while ignoring forward-looking capital allocations. Recent capital moves and shifting Wall Street sentiment suggest that the worst of Dollar Tree's margin compression is in the rearview mirror.

Pruning the Float: A $2.5B Buyback Takes RootWhen equity prices face sustained downward pressure, institutional behavior and management capital allocation provide the clearest signal of a fundamental floor. On July 2, 2026, the Dollar Tree board of directors authorized a $2.5 billion share repurchase program. For an enterprise carrying a $23.76 billion market capitalization, this authorization represents a potential retirement of roughly 10.7% of the outstanding float.

This move serves as a standard return of capital, but investors should also view it as an aggressive defense of the current valuation. The $2.5 billion authorization arrived shortly after a significant institutional shift. In June 2026, activist investor Mantle Ridge executed a $500 million accelerated share repurchase via a block trade. Mantle Ridge executed large-volume block trades with major banks, who in turn sold the shares back to Dollar Tree outside of the market to avoid affecting the working share price.

The exit of activist capital, paired with a concurrent reduction in board seats, signals that Dollar Tree is transitioning out of a turbulent restructuring phase and returning its focus to organic operational execution. A block trade clears institutional overhang, allowing the stock to discover its natural price without the downward pressure of a major stakeholder liquidating on the open market. By actively reducing the share count, management mathematically bolsters future earnings per share, creating a protective floor against ongoing top-line volatility.

Trimming Costs to Spark Bottom-Line GrowthThe most compelling argument for a turnaround lies directly on the balance sheet. In retail, top-line revenue grabs the headlines, but gross margin pays the bills.

This margin recovery stems from tangible structural tailwinds that are beginning to cascade down the income statement. Dollar Tree successfully secured $110 million in tariff refunds, providing an immediate, unexpected cash injection. Easing logistics and freight costs are further padding the bottom line.

Dollar Tree Stock Forecast Today12-Month Stock Price Forecast:
$122.68
0.15% Upside

Hold
Based on 26 Analyst Ratings

Current Price$122.49High Forecast$170.00Average Forecast$122.68Low Forecast$85.00Dollar Tree Stock Forecast Details

In a high-volume, low-margin business environment, capturing an additional 120 basis points of margin is an operational victory that directly offsets the sluggish consumer environment. If the broader macroeconomic environment worsens, a repaired margin structure provides crucial downside protection.

Wall Street is beginning to reprice these structural improvements. Two prominent analyst upgrades hit the wire in early July. Raymond James upgraded Dollar Tree from Market Perform to Outperform, establishing a $140 price target. Their analysis points to fiscal 2026 guidance being artificially conservative, noting that additional tariff refunds and supply chain efficiencies could yield hundreds of millions in unexpected profitability in the back half of the year.

Goldman Sachs also adjusted its stance, moving from Sell to Neutral and bumping its price target to $125. The shift from a bearish to a neutral rating from a major institutional desk often forces large portfolio managers to reevaluate their short exposure, potentially triggering a steady unwinding of bearish bets. With short interest hovering around 7.66%, representing over 13 million shares, any string of operational beats creates the conditions for a sustained technical reversal.

Watering the Roots: Value Perception Precedes TrafficTo analyze the setup objectively, investors should examine the lingering bearish arguments. Top-line foot traffic remains the primary headwind. In Q1, Dollar Tree reported a negative 1% traffic comp, indicating that the core low-income demographic is still visiting stores less frequently than in previous years.

Rival operators like Dollar General NYSE: DG continue to aggressively expand their real estate footprint, while big-box giants like Walmart NASDAQ: WMT and Target NYSE: TGT use deep price rollbacks to fiercely defend their market share. Dollar General's strategy of blanketing rural America with new store openings keeps constant pressure on Dollar Tree to maintain its competitive footing. The competitive environment is brutal, and waiting for traffic to turn positive before initiating a position often means missing the largest segment of the equity recovery.

This is where leading indicators become vital. The Goldman Sachs upgrade relied heavily on proprietary sentiment data. This specific data set tracks consumer perception of price and value. According to their findings, value perceptions among low-income households are finally beginning to stabilize and turn positive. Consumer perception serves as a leading indicator, as shoppers must believe a retailer offers superior value before they change their driving habits and foot traffic patterns.

If value perception is indeed stabilizing, the negative traffic comps should begin to flatten out over the next two quarters. Because Dollar Tree already fixed the margin structure, any eventual return of positive foot traffic will drop cleanly to the bottom line without being absorbed by elevated supply chain costs.

The Harvest: Is Dollar Tree Ripe for the Picking?The current financial metrics fit a classic value-investing framework. Dollar Tree trades at a deeply compressed trailing price-to-sales ratio of 1.22x and a forward price-to-earnings ratio of 17.66. The market is valuing Dollar Tree as if the peak margin compression of 2024 and 2025 is a permanent fixture, entirely discounting the 120-bps margin expansion reported in the most recent quarter.

Navigating the retail sector requires identifying businesses that can engineer their own profitability regardless of macroeconomic traffic slumps. The combination of easing logistics costs, substantial tariff refunds, and a management team willing to retire over 10% of the float creates an asymmetric risk profile.

Investors seeking exposure to the discount retail turnaround might watch the upcoming Q2 earnings release for signs of continued gross margin stability. Those comfortable with near-term volatility may view the current valuation multiples as an opportunity to build a position before consumer foot traffic officially catches up to the newly repaired balance sheet.

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CHESAPEAKE, Va.--(BUSINESS WIRE)--Dollar Tree, Inc. (NASDAQ: DLTR) (the “Company”) today announced that its Board of Directors has replenished the Company’s share repurchase authorization to an aggregate amount of $2.5 billion, consistent with the authorization limit previously approved by the Board in July 2025. This new reauthorization includes any amounts remaining under the Company’s pre-existing program.

As recently announced, the Company repurchased $500 million of its common stock in June 2026 as part of a block trade involving selling stockholders including certain funds affiliated with Mantle Ridge LP. Following that transaction, the Company had approximately $700 million remaining under its existing $2.5 billion authorization.

"The replenishment of our share repurchase authorization reinforces our commitment to disciplined capital allocation and reflects our confidence in Dollar Tree's long-term growth," said Michel C. Creedon, Jr., Chief Executive Officer. "We remain focused on investing in strategic initiatives that support sustainable growth, maintaining financial strength and flexibility, and returning excess capital to shareholders over time.”

The Board’s authorization permits the Company to repurchase shares of its common stock from time to time in the open market or through privately negotiated transactions, subject to market and other conditions, up to the aggregate amount authorized by the Board. The Board’s authorization has no expiration date.

About Dollar Tree, Inc.

Dollar Tree, Inc., headquartered in Chesapeake, VA, is one of North America’s largest and most loved value retailers, known for delivering great value, convenience, and a “thrill-of-the-hunt” discovery shopping experience. With a team of approximately 150,000 associates, Dollar Tree operates more than 9,300 stores and 19 distribution centers across 48 contiguous states and seven Canadian provinces under the brands Dollar Tree and Dollar Tree Canada. The Company is committed to being a responsible steward of its business – supporting its people, serving its communities, and creating lasting value. To learn more about the Company, visit www.DollarTree.com.

A WARNING ABOUT FORWARD-LOOKING STATEMENTS: This press release contains "forward-looking statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they address future events, developments or results and do not relate strictly to historical facts. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include, without limitation, statements preceded by, followed by or including words such as: “believe”, “anticipate”, “expect”, “intend”, “plan”, “view”, “target” or “estimate”, “may”, “will”, “should”, “predict”, “possible”, “potential”, “continue”, “strategy”, and similar expressions. For example, our forward-looking statements include statements regarding our plans and expectations concerning share repurchases, capital allocation, strategic and other growth initiatives, cash flow and other objectives and expectations. These statements are subject to risks and uncertainties. For a discussion of the risks, uncertainties and assumptions that could affect our future events, developments or results, you should carefully review the “Risk Factors,” “Business” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” sections in our Annual Report on Form 10-K filed March 16, 2026, our Quarterly Report on Form 10-Q for the most recently ended fiscal quarter, and other filings we make from time to time with the Securities and Exchange Commission. We are not obligated to release publicly any revisions to any forward-looking statements contained in this press release to reflect events or circumstances occurring after the date of this report and you should not expect us to do so.

More News From Dollar Tree, Inc.

Back to Newsroom

Dollar Tree delivered a 7.2% sales growth YoY, with comparable sales contributing as much as 3.5% to the growth. The poor consumer sentiment in the U.S. is expected to create tailwinds in the near term, as people are becoming more and more cost conscious. Comparing DLTR with its peers, the firm's stock seems to be fairly valued, with relatively low insider selling.

CHESAPEAKE, Va.--(BUSINESS WIRE)--Dollar Tree, Inc. (NASDAQ: DLTR) (the “Company” or “Dollar Tree”) today announced that certain funds affiliated with Mantle Ridge LP (“Mantle Ridge”) and a selling stockholder that is counterparty to derivative agreements with affiliates of Mantle Ridge (collectively, the “Selling Stockholders”) have launched a secondary block trade (the “block trade”) to sell 12,820,400 shares of the Company's common stock (the “common stock”) to J.P. Morgan and Goldman Sachs.

Key Takeaways Dollar Tree expanded gross margin 120 bps on higher merchandise margins, freight gains and lower shrink.Shrink reduction was the largest contributor to the quarterly gross margin beat.Dollar Tree expects higher fuel costs and potential tariff increases to pressure profitability in FY26. Dollar Tree, Inc. (DLTR - Free Report) delivered one of its strongest profitability performances in recent quarters, demonstrating the effectiveness of its ongoing operational and merchandising initiatives. Despite a challenging consumer environment and persistent tariff-related pressures, the company generated meaningful margin improvement through better execution across key areas of the business. Management highlighted progress in shrink reduction, merchandise optimization and cost controls, underscoring that many of the factors driving profitability are company-specific and within its control.

Margin performance stood out in the quarter. Gross margin expanded 120 basis points year over year, supported by higher merchandise margins, freight favorability and lower shrink. Adjusted operating margin also improved 110 basis points to 9.5%, reflecting stronger execution across controllable areas of the business. These gains came despite headwinds from higher tariffs and markdown activity, underscoring Dollar Tree’s ability to protect profitability through operational discipline.

A key contributor to the margin expansion was the company's progress in reducing shrink — an area management has aggressively targeted through its Gold Store standards, enhanced audits, improved training and product-protection initiatives. Executives indicated that shrink improvement was the single largest contributor to the quarterly gross margin beat. At the same time, inventory discipline has improved significantly, with inventory declining 9% year over year despite sales growth of 7.2%. Better inventory management, improved merchandise productivity and a more efficient supply chain are creating a stronger foundation for sustainable profitability.

The key question now is whether these gains can continue amid an uncertain tariff environment. Management remains cautiously optimistic, noting that operational improvements are largely within its control and should continue to support margins. However, the company expects higher fuel costs and potential tariff increases in the second half of fiscal 2026, which could create fresh pressure on profitability. Even so, Dollar Tree's ongoing shrink-reduction efforts, disciplined cost management and growing contribution from higher-margin multi-price merchandise position the retailer to offset at least part of these external headwinds. If execution remains strong, margin expansion could remain an important earnings driver despite the tariff uncertainty ahead.

DLTR’s Price Performance, Valuation & EstimatesShares of this Zacks Rank #2 (Buy) company have gained 7% in the past three months against the industry’s loss of 1.5%.

Image Source: Zacks Investment Research

From a valuation standpoint, DLTR trades at a forward price-to-earnings ratio of 15.69X compared with the industry’s average of 31.25X.

The Zacks Consensus Estimate for DLTR’s current fiscal-year sales and earnings implies year-over-year growth of 6.5% and 21.5%, respectively. For the next fiscal year, the consensus estimate indicates a 6.2% rise in sales and 10.2% growth in earnings. The company’s EPS estimate for both fiscal years has remained stable in the past seven days.

Other Key PicksRoss Stores (ROST - Free Report) , a leading U.S. off-price retailer operating Ross Dress for Less and dd's DISCOUNTS stores, sports a Zacks Rank #1 (Strong Buy) at present. ROST delivered a trailing four-quarter earnings surprise of 10.2%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for Ross Stores’ current fiscal-year sales and earnings suggests growth of 9.1% and 17.1%, respectively, from the year-ago figures.

Five Below, Inc. (FIVE - Free Report) , which operates as a specialty value retailer, currently flaunts a Zacks Rank #1. FIVE delivered a trailing four-quarter earnings surprise of 70.1%, on average.

The Zacks Consensus Estimate for Five Below’s current fiscal-year sales and earnings suggests growth of 14.7% and 31.7%, respectively, from the year-ago figures.

Tapestry, Inc. (TPR - Free Report) provides accessories and lifestyle brand products in North America, Greater China, the rest of Asia and internationally. At present, TPR sports a Zacks Rank of 1.

The Zacks Consensus Estimate for current fiscal-year sales and earnings implies growth of 13.8% and 36.3%, respectively, from the year-ago reported figures. TPR has delivered a trailing four-quarter earnings surprise of 15.6%, on average.

Key Takeaways DLTR is shifting beyond one-price retail with broader assortments, larger pack sizes and more choice.DLTR's comparable sales rose as higher ticket offset softer traffic from more selective shoppers.DLTR is using delivery, new stores and margin execution to support a modern value-retail model. Dollar Tree, Inc. (DLTR - Free Report) is showing how value retail is changing. The model is no longer defined only by the lowest opening price.

The newer playbook depends on broader assortment, higher basket size, sharper execution and stronger convenience. Dollar Tree’s latest results make that shift clear, even as pressure on consumers keeps the story balanced.

Dollar Tree Expands Beyond One PriceDollar Tree’s move into a broader multi-price format marks a major structural change for the chain. The company is using the format to offer higher-quality items, larger pack sizes and more choice across categories.

That does not mean the value message is being abandoned. Management has emphasized that the opening price point remains central to the brand, while the expanded price architecture gives the company more room to improve assortment relevance and product quality.

DLTR Leans on Ticket Over TrafficFirst-quarter fiscal 2026 comparable-store sales rose 3.5%, but the composition matters. Average ticket increased 4.5%, while traffic declined 1%.

That mix points to a more selective shopper. Customers are still spending, but they are doing so with greater focus on value, convenience and need-based trips. For Dollar Tree, that raises the importance of assortment, price communication and consistent store execution.

Dollar Tree Turns Execution Into Margin SupportMargin improvement is another sign of how discount retail is evolving. Dollar Tree’s gross margin expanded 120 basis points in the first quarter, helped by higher mark-on, lower freight costs and lower shrink.

Adjusted operating margin rose 110 basis points to 9.5%. The drivers show that value retailers cannot rely on price alone. Product protection, shrink control, field discipline and freight efficiency are becoming key parts of the earnings formula.

Image Source: Zacks Investment Research

DLTR Builds Reach Through Stores and DeliveryDollar Tree is also expanding the ways it reaches customers. The company opened 113 new stores in the first quarter and ended the period with 9,382 stores.

Delivery access is becoming part of the model as well. As of Jan. 31, 2026, more than 8,800 Dollar Tree stores were serviceable through Uber Eats, giving the banner another way to reach younger and time-constrained shoppers. Distribution center investments are also aimed at supporting larger assortments, better in-stock levels and more reliable execution.

Dollar Tree Faces the Limits of the TrendThe shift toward broader value retail still faces real limits. Tariffs and markdowns partially offset first-quarter gross margin gains, while higher fuel costs and transportation uncertainty remain risks for the rest of fiscal 2026.

Consumer pressure is another constraint. Lower-income households remain cautious, and shopping behavior is still closer to need. That makes traffic recovery a key test for Dollar Tree and other value retailers.

Dollar General Corporation (DG - Free Report) offers a useful peer comparison because it also serves shoppers focused on affordability and everyday essentials. Five Below Inc. (FIVE - Free Report) adds another lens, as its extreme-value model depends on discretionary appeal, trend-right merchandise and frequent customer visits.

How DLTR’s Zacks Rank Frames the TrendThe bottom line is that Dollar Tree is participating in attractive retail shifts, but the stock is not yet a clean high-conviction call. Multi-price expansion, delivery access and margin execution all point to a more modern value-retail model.

DLTR currently carries a Zacks Rank #3 (Hold). That rank fits a company making operational progress while still navigating traffic pressure, tariff uncertainty and cost headwinds.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Style Scores are more encouraging. DLTR has a VGM Score of A, Growth Score of A, Momentum Score of A and Value Score of B. Those marks suggest favorable underlying traits for investors tracking trend-backed retailers, while the Zacks Rank keeps the broader stance measured.

CHESAPEAKE, Va.--(BUSINESS WIRE)--Dollar Tree, Inc. (NASDAQ: DLTR) today reported financial results for its first quarter ended May 2, 2026.

“Our first quarter results reflect continued progress across the business and demonstrate the strength of Dollar Tree’s position as the preferred destination for value, convenience, and discovery,” said Mike Creedon, Chief Executive Officer. “We continued advancing our strategic plan – a more relevant assortment, agile cost management, a stronger customer connection, and new store growth coupled with improved store conditions – all driving operating margin expansion and delivering a strong bottom-line performance. As we celebrate our 40th anniversary in 2026, we are encouraged by the progress we are seeing across the business and remain focused on making thoughtful investments in our stores, assortment and customer experience – building Dollar Tree to last for decades to come.”

Additional Business Highlights

Opened 113 new Dollar Tree stores during the quarter Converted or added about 630 stores to the Dollar Tree multi-price format, ending the quarter with approximately 5,900 multi-price stores Generated $644 million of net cash provided by operating activities from continuing operations and $392 million of free cash flow Ended the quarter with 9,382 stores across the Dollar Tree U.S. and Dollar Tree Canada banners First Quarter 2026 Key Operating Results (unaudited)

(from continuing operations unless otherwise noted)

(Compared to same period fiscal 2025)

Q1

Fiscal 2026

Change

Net Sales

$5.0B

7.2%

Same-Store Net Sales Growth

3.5%

Operating Income

$473M

23.2%

Diluted EPS

$1.76

19.7%

Adjusted Operating Income1

$473M

22.0%

Adjusted Diluted EPS1

$1.74

38.1%

1Adjustment for the first quarter of 2026 is a non-operating insurance gain. For the first quarter of 2025, adjustments are for strategic review costs and a non-operating insurance gain. See "Reconciliation of Non-GAAP Financial Measures" below for detailed schedules of this adjustment and the adjustments for the prior year comparable period.

  First Quarter Results

Results for the first quarter ended May 2, 2026 are reported on a continuing operations basis. Continuing operations reflect the results of Dollar Tree brands in the United States and Canada.

Unless otherwise noted, all comparisons are to the prior year’s first quarter ended May 3, 2025 for the results of continuing operations.

Net sales increased 7.2% to $5.0 billion. Comparable store net sales increased 3.5%, driven by a 4.5% increase in average ticket, partially offset by a 1.0% decline in traffic.

Gross profit margin increased 120 basis points. The improvement in gross margin was primarily driven by higher mark-on, lower freight costs, and lower shrink. These benefits were partially offset by higher tariff costs and higher markdowns.

Selling, general and administrative expenses increased 50 basis points to 27.8% of total revenue. The increase was primarily due to higher marketing costs, general liability costs, and higher depreciation partially offset by lower payroll costs.

Adjusted selling, general and administrative expenses inclusive of transition services agreement income, net increased 10 basis points as a percent of total revenue.

Transition services agreement income, net was $21.1 million for services provided between Dollar Tree and Family Dollar following the sale.

Operating income increased 23% to $473.3 million and operating margin expanded 120 basis points. Adjusted operating income increased 22% to $473.3 million.

The Company’s effective tax rate was 24.9%.

Income from continuing operations was $347.3 million and diluted earnings per share from continuing operations was $1.76. On an adjusted basis, income from continuing operations was $343.4 million and adjusted diluted earnings per share was $1.74.

The Company repurchased 5.5 million shares of its common stock during the first quarter of fiscal 2026 for $595 million.

As of May 2, 2026, the Company had $1.3 billion remaining under its share repurchase authorization, $1 billion of cash and cash equivalents, no commercial paper outstanding, and no borrowings under its revolving credit facility.

Fiscal 2026 Outlook

Our full-year fiscal 2026 outlook is presented on a continuing operations basis and excludes the impact of tariff refunds.

For fiscal 2026, the Company now expects:

Net sales from continuing operations in the range of $20.5 billion to $20.7 billion, based on comparable
store net sales growth in the range of 3% to 4% Approximately 400 new store openings and 75 closings Adjusted diluted earnings per share in the range of $6.70 to $7.10 Second Quarter 2026 Outlook

The Company expects net sales from continuing operations for the second quarter will range from $4.8 billion to $4.9 billion, based on comparable store net sales growth in the range of 2.5% to 3.5%.

Adjusted diluted EPS for the second quarter 2026 is estimated to be in the range of $1.00 to $1.15.

Conference Call Information

On May 28, 2026, the Company will host a conference call to discuss its earnings results at 8:00 a.m. Eastern Time. The telephone number for the call is (877) 407-3943 or (201) 689-8855. A recorded version of the call will be available for seven days after the call and may be accessed by dialing (877) 660-6853 or (201) 612-7415. The access code is 13760394. A webcast of the call is also accessible through the Investor Relations portion of the Company’s website.

Supplemental financial information for the fourth quarter is available on the Investor Relations portion of the Company’s website, at https://corporate.dollartree.com/investors.

Dollar Tree, Inc., headquartered in Chesapeake, VA, is one of North America’s largest and most loved value retailers, known for delivering great value, convenience, and a “thrill-of-the-hunt” discovery shopping experience. With a team of approximately 150,000 associates, Dollar Tree operates more than 9,300 stores and 19 distribution centers across 48 contiguous states and seven Canadian provinces under the brands Dollar Tree and Dollar Tree Canada. The Company is committed to being a responsible steward of its business – supporting its people, serving its communities, and creating lasting value. To learn more about the Company, visit www.DollarTree.com.

Use of Non-GAAP Financial Measures

The Company reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP”). From time to time, the Company supplements the reporting of its financial information determined under GAAP with certain non-GAAP financial information. The non-GAAP financial measures we have disclosed include adjusted corporate selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net; adjusted corporate selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net as a percentage of total revenue; adjusted selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net; adjusted selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net as a percentage of total revenue; adjusted selling, general and administrative expenses, exclusive of corporate selling, general and administrative expenses; adjusted selling, general and administrative expenses, exclusive of corporate selling, general and administrative expenses as a percentage of total revenue; adjusted operating income; adjusted operating income margin; adjusted income from continuing operations; adjusted income from continuing operations as a percentage of total revenue; adjusted diluted earnings per share - continuing operations; and adjusted effective tax rate, in each case with respect to our continuing operations; and free cash flow.

Reconciliations of the non-GAAP financial measures to the corresponding amounts prepared in accordance with GAAP appears in the tables under the heading “Reconciliation of Non-GAAP Financial Measures” below. These tables provide additional information regarding the adjusted measures.

A WARNING ABOUT FORWARD-LOOKING STATEMENTS: Our press release contains "forward-looking statements" as that term is used in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they address future events, developments or results and do not relate strictly to historical facts. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Forward-looking statements include, without limitation, statements preceded by, followed by or including words such as: “believe”, “anticipate”, “expect”, “intend”, “plan”, “view”, “target” or “estimate”, “may”, “will”, “should”, “predict”, “possible”, “potential”, “continue”, “strategy”, and similar expressions. For example, our forward-looking statements include statements relating to our business and financial outlook for fiscal 2026, including without limitation our expectations regarding net sales, comparable store sales and adjusted diluted earnings per share for the second fiscal quarter and full fiscal year 2026, new store openings and closings for 2026 and various factors that are expected to impact our quarterly and annual results of operations for fiscal 2026; the direct and indirect impacts of current and potential tariffs and other trade-related measures and our plans to mitigate those impacts; our plans and expectations regarding our business, including the impact of various initiatives, investments, and strategies on the company’s performance and prospects for long-term growth; and our other plans, objectives, expectations (financial and otherwise) and intentions. These statements are subject to risks and uncertainties. For a discussion of the risks, uncertainties and assumptions that could affect our future events, developments or results, you should carefully review the "Risk Factors," "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections in our Annual Report on Form 10-K filed March 16, 2026, our Form 10-Q for the most recently ended fiscal quarter and other filings we make from time to time with the Securities and Exchange Commission. We are not obligated to release publicly any revisions to any forward-looking statements contained in this press release to reflect events or circumstances occurring after the date of this report and you should not expect us to do so. 

DLTR-E

DOLLAR TREE, INC.

Condensed Consolidated Income Statements

(In millions, except per share data)

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Revenues

Net sales

$

4,970.5

$

4,636.5

Other revenue

5.3

3.2

Total revenue

4,975.8

4,639.7

Expenses and other operating items

Cost of sales

3,141.0

2,987.0

Selling, general and administrative expenses

1,382.6

1,268.6

Transition services agreement income, net

21.1

—

Operating income

473.3

384.1

Interest expense, net

16.3

22.7

Other income, net

5.4

61.7

Income from continuing operations before income taxes

462.4

423.1

Provision for income taxes

115.1

109.6

Income from continuing operations

347.3

313.5

Income from discontinued operations, net of tax

—

29.9

Net income

$

347.3

$

343.4

Net earnings per share:

Basic from continuing operations

$

1.76

$

1.47

Basic from discontinued operations

—

0.14

Basic per share of common stock

$

1.76

$

1.61

Basic weighted average number of shares

196.8

213.6

Diluted from continuing operations

$

1.76

$

1.47

Diluted from discontinued operations

—

0.14

Diluted per share of common stock

$

1.76

$

1.61

Diluted weighted average number of shares

197.4

213.9

Selling, general and administrative expense rate

27.8

%

27.3

%

Transition services agreement income, net as a percentage of total revenue

0.4

%

—

%

Operating income margin

9.5

%

8.3

%

Income from continuing operations before income taxes as percentage of total revenue

9.3

%

9.1

%

Effective tax rate

24.9

%

25.9

%

Income from continuing operations as percentage of total revenue

7.0

%

6.8

%

The selling, general and administrative expense rate and operating income margin are calculated by dividing the applicable amount by total revenue.

Amounts in tables above may not recalculate due to rounding.

DOLLAR TREE, INC.

Condensed Consolidated Balance Sheets

(In millions)

(Unaudited)

May 2, 2026

January 31, 2026

May 3, 2025

ASSETS

Current Assets:

Cash and cash equivalents

$

1,007.3

$

717.8

$

1,007.4

Merchandise inventories

2,470.8

2,495.4

2,704.0

Other current assets

220.3

233.0

179.8

Current assets of discontinued operations

—

—

4,705.5

Total current assets

3,698.4

3,446.2

8,596.7

Restricted cash

43.4

42.9

76.7

Property, plant and equipment, net

5,028.1

4,959.6

4,587.9

Operating lease right-of-use assets

4,478.2

4,435.1

4,205.6

Goodwill

423.0

423.2

422.6

Deferred income taxes, net

1.7

1.0

268.7

Other assets

151.0

158.2

133.0

Total assets

$

13,823.8

$

13,466.2

$

18,291.2

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Current portion of long-term debt

$

—

$

—

$

1,000.0

Current portion of operating lease liabilities

1,005.2

1,000.2

971.3

Accounts payable

1,563.8

1,530.7

1,572.0

Income taxes payable

—

—

239.9

Other current liabilities

615.4

697.7

549.9

Current liabilities of discontinued operations

—

—

3,903.7

Total current liabilities

3,184.4

3,228.6

8,236.8

Long-term debt, net, excluding current portion

2,932.6

2,431.7

2,428.8

Operating lease liabilities, long-term

3,655.5

3,623.7

3,507.3

Deferred income taxes, net

264.3

153.3

—

Income taxes payable, long-term

27.5

29.7

27.3

Other liabilities

252.5

244.3

186.2

Total liabilities

10,316.8

9,711.3

14,386.4

Shareholders' equity

3,507.0

3,754.9

3,904.8

Total liabilities and shareholders' equity

$

13,823.8

$

13,466.2

$

18,291.2

The January 31, 2026 information was derived from the audited consolidated financial statements as of that date.

DOLLAR TREE, INC.

Condensed Consolidated Statements of Cash Flows

(In millions)

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Cash flows from operating activities:

Net income

$

347.3

$

343.4

Income from discontinued operations, net of tax

—

29.9

Income from continuing operations

$

347.3

$

313.5

Adjustments to reconcile income from continuing operations to net cash provided by operating activities:

Depreciation and amortization

177.0

151.1

Provision for deferred income taxes

110.4

14.1

Stock-based compensation expense

21.1

17.2

Impairments

0.4

0.1

Gain on insurance proceeds related to fixed assets

—

(41.0

)

Other non-cash adjustments to income from continuing operations

12.4

3.1

Changes in operating assets and liabilities:

Merchandise inventories

24.1

(27.6

)

Income taxes receivable

5.5

—

Other current assets

7.2

(18.6

)

Other assets

(2.5

)

0.7

Accounts payable

33.4

(135.9

)

Income taxes payable

—

92.5

Other current liabilities

(91.9

)

(13.0

)

Other liabilities

5.9

2.6

Operating lease right-of-use assets and liabilities, net

(6.3

)

19.7

Net cash provided by operating activities of continuing operations

644.0

378.5

Cash flows from investing activities:

Capital expenditures

(252.5

)

(248.8

)

Proceeds from insurance recoveries

—

50.0

Payments for fixed asset disposition

(0.4

)

(0.1

)

Net cash used in investing activities of continuing operations

(252.9

)

(198.9

)

Cash flows from financing activities:

Proceeds from long-term debt

500.0

—

Debt-issuance costs

—

(3.8

)

Proceeds from stock issued pursuant to stock-based compensation plans

2.4

2.8

Cash paid for taxes on exercises/vesting of stock-based compensation

(17.5

)

(10.7

)

Payments for repurchase of stock

(585.8

)

(427.7

)

Net cash used in financing activities

(100.9

)

(439.4

)

Cash flows from discontinued operations:

Net cash provided by operating activities of discontinued operations

—

104.5

Net cash used in investing activities of discontinued operations

—

(45.4

)

Net cash provided by discontinued operations

—

59.1

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(0.2

)

0.7

Net change in cash, cash equivalents and restricted cash

290.0

(200.0

)

Cash, cash equivalents and restricted cash at beginning of period

760.7

1,511.2

Cash, cash equivalents and restricted cash at end of period

$

1,050.7

$

1,311.2

DOLLAR TREE, INC.

Store Activity and Selected Sales Data

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Store Count:

Beginning

9,282

8,881

New stores

113

148

Stores converted from Family Dollar (a)

—

5

Closings

(13

)

(18

)

Ending

9,382

9,016

Selling Square Footage (in millions)

83.5

79.6

Growth Rate (Square Footage)

4.9

%

7.4

%

52 Weeks Ended

May 2, 2026

May 3, 2025

Sales per Square Foot (b)

$

242

$

235

(a)

Stores converted from a Family Dollar store to a Dollar Tree store are reflected in the table above when they re-opened as a Dollar Tree store.

(b)

Sales per square foot is calculated based on total net sales for the reporting period divided by the average selling square footage during the period.

DOLLAR TREE, INC.

Reconciliation of Non-GAAP Financial Measures

(In millions, except per share data)

(Unaudited)

From time-to-time, the Company discloses certain financial measures not derived in accordance with GAAP. These non-GAAP financial measures should not be used as a substitute for GAAP financial measures, or considered in isolation, for the purposes of analyzing operating performance, financial position, liquidity, or cash flows. The non-GAAP financial measures we have disclosed include adjusted corporate selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net; adjusted corporate selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net as a percentage of total revenue; adjusted selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net; adjusted selling, general and administrative expenses, exclusive and inclusive of transition services agreement income, net as a percentage of total revenue; adjusted selling, general and administrative expenses, exclusive of corporate selling, general and administrative expenses; adjusted selling, general and administrative expenses, exclusive of corporate selling, general and administrative expenses as a percentage of total revenue; adjusted operating income; adjusted operating income margin; adjusted income from continuing operations; adjusted income from continuing operations as a percentage of total revenue; adjusted diluted earnings per share - continuing operations; and adjusted effective tax rate, in each case with respect to our continuing operations. The Company believes providing additional information in these non-GAAP measures that exclude the unusual expenses and income described below is beneficial to the users of its financial statements in evaluating the Company's current operating results in relation to past periods. In addition, the Company's debt covenants exclude the impact of certain unusual expenses. The Company has included a reconciliation of these non-GAAP financial measures to the most comparable GAAP measures in the following tables.

1.)

During the first quarter of fiscal 2025, the Company entered into a definitive agreement to sell the Family Dollar business, and completed the sale on July 5, 2025. We incurred consulting, legal and other expenses related to the sale and separation activities, including costs associated with optimizing the remaining Dollar Tree business post-divestiture. Costs associated with these activities incurred in the first quarter of fiscal 2025 totaled $3.7 million.

2.)

During the first quarter of fiscal 2024, a tornado destroyed our Dollar Tree distribution center in Marietta, Oklahoma ("DC 8"). As a result of the destruction, we have incurred losses totaling $129.0 million, consisting of $70.0 million related to damaged inventory and $59.0 million related to property and equipment. These losses are fully insured and therefore not contemplated in the non-GAAP adjustments below. Since the end of the first quarter of fiscal 2024, we have received insurance proceeds totaling $125.0 million related to damaged inventory, and $100.0 million related to damaged property, including $70.0 million in the first quarter of fiscal 2025 and $5.2 million in the first quarter of fiscal 2026. In the fourth quarter of fiscal 2024, we recorded a gain of $29.7 million for insurance proceeds received. We recorded additional gains in the first quarters of fiscal 2025 and fiscal 2026 totaling $61.8 million and $5.2 million, respectively, for insurance proceeds received.

In addition, the Company discloses free cash flow, a non-GAAP financial measure that we calculate as net cash provided by operating activities less capital expenditures. The Company believes free cash flow is an important indicator of our liquidity as it measures the amount of cash we generate from our business operations. Free cash flow may not represent the amount of cash flow available for general discretionary use, because it excludes non-discretionary expenditures, such as mandatory debt repayments and required settlements of recorded and/or contingent liabilities not reflected in cash flow from operations. The Company has included a reconciliation of free cash flow to the most comparable GAAP measures in the following tables.

A reconciliation of the projected adjusted diluted EPS, which is a forward-looking non-GAAP financial measure, to the most directly comparable GAAP financial measure, is not provided because the company is unable to provide such reconciliation without unreasonable effort. The inability to provide a reconciliation is due to the uncertainty and inherent difficulty predicting the occurrence, the financial impact and the periods in which the non-GAAP adjustments may be recognized. GAAP measures may include the impact of such items as litigation reserves; restructuring charges; goodwill and intangible asset impairments; natural disasters; our store portfolio optimization review and strategic review and sale of Family Dollar, and the tax effect of all such items. Historically, the company has excluded these items from non-GAAP financial measures. The company currently expects to continue to exclude these items in future disclosures of non-GAAP financial measures and may also exclude other items that may arise (collectively, “non-GAAP adjustments”). The decisions and events that typically lead to the recognition of non-GAAP adjustments, such as a decision to exit part of the business or reaching settlement of a legal dispute, are inherently unpredictable as to if or when they may occur. For the same reasons, the company is unable to address the probable significance of the unavailable information, which could be material to future results.

DOLLAR TREE, INC.

Reconciliation of Non-GAAP Financial Measures - Continuing Operations

(In millions, except per share data)

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Reconciliation of Adjusted Corporate Selling, General and Administrative Expenses, Exclusive of Transition Services Agreement Income, Net

Corporate selling, general and administrative expenses (GAAP)

$

141.8

$

141.8

Deduct: Strategic review costs

—

(0.1

)

Adjusted corporate selling, general and administrative expenses, exclusive of transition services agreement income, net (Non-GAAP)

$

141.8

$

141.7

Adjusted corporate selling, general and administrative expenses, exclusive of transition services agreement income, net as percentage of total revenue (Non-GAAP)

2.8

%

3.1

%

Reconciliation of Adjusted Corporate Selling, General and Administrative Expenses, Inclusive of Transition Services Agreement Income, Net

Corporate selling, general and administrative expenses (GAAP)

$

141.8

$

141.8

Deduct: Strategic review costs

—

(0.1

)

Deduct: Transition services agreement income, net

(21.1

)

—

Adjusted corporate selling, general and administrative expenses, inclusive of transition services agreement income, net (Non-GAAP)

$

120.7

$

141.7

Adjusted corporate selling, general and administrative expenses, inclusive of transition services agreement income, net as percentage of total revenue (Non-GAAP)

2.4

%

3.1

%

Reconciliation of Adjusted Selling, General and Administrative Expenses, Exclusive of Transition Services Agreement Income, Net

Selling, general and administrative expenses (GAAP)

$

1,382.6

$

1,268.6

Deduct: Strategic review costs

—

(3.7

)

Adjusted selling, general and administrative expenses, exclusive of transition services agreement income, net (Non-GAAP)

$

1,382.6

$

1,264.9

Adjusted selling, general and administrative expenses, exclusive of transition services agreement income, net as percentage of total revenue (Non-GAAP)

27.8

%

27.3

%

  DOLLAR TREE, INC.

Reconciliation of Non-GAAP Financial Measures - Continuing Operations

(In millions, except per share data)

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Reconciliation of Adjusted Selling, General and Administrative Expenses, Inclusive of Transition Services Agreement Income, Net

Selling, general and administrative expenses (GAAP)

$

1,382.6

$

1,268.6

Deduct: Strategic review costs

—

(3.7

)

Deduct: Transition services agreement income, net

(21.1

)

—

Adjusted selling, general and administrative expenses, inclusive of transition services agreement income, net (Non-GAAP)

$

1,361.5

$

1,264.9

Adjusted selling, general and administrative expenses, inclusive of transition services agreement income, net as percentage of total revenue (Non-GAAP)

27.4

%

27.3

%

Reconciliation of Adjusted Selling, General and Administrative Expenses, Exclusive of Corporate Selling, General and Administrative Expenses

Selling, general and administrative expenses (GAAP)

$

1,382.6

$

1,268.6

Deduct: Strategic review costs

—

(3.6

)

Deduct: Corporate selling, general and administrative expenses

(141.8

)

(141.8

)

Adjusted selling, general and administrative expenses, exclusive of corporate selling, general and administrative expenses (Non-GAAP)

$

1,240.8

$

1,123.2

Adjusted selling, general and administrative expenses, exclusive of corporate selling, general and administrative expenses as percentage of total revenue (Non-GAAP)

24.9

%

24.2

%

Reconciliation of Adjusted Operating Income

Operating income (GAAP)

$

473.3

$

384.1

Add: Strategic review costs

—

3.7

Adjusted operating income (Non-GAAP)

$

473.3

$

387.8

Adjusted operating income margin (Non-GAAP)

9.5

%

8.4

%

Reconciliation of Adjusted Income from Continuing Operations

Income from Continuing Operations (GAAP)

$

347.3

$

313.5

SG&A adjustments:

Add: Strategic review costs

—

3.7

Non-operating adjustment:

Deduct: Non-operating insurance gain

(5.2

)

(61.8

)

Provision for income tax adjustments

1.3

14.3

Adjusted income from continuing operations (Non-GAAP)

$

343.4

$

269.7

Adjusted income from continuing operations as percentage of total revenue (Non-GAAP)

6.9

%

5.8

%

DOLLAR TREE, INC.

Reconciliation of Non-GAAP Financial Measures - Continuing Operations

(In millions, except per share data)

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Reconciliation of Adjusted Diluted Earnings Per Share - Continuing Operations

Diluted earnings per share - continuing operations (GAAP)

$

1.76

$

1.47

SG&A adjustments:

Add: Strategic review costs

—

0.02

Non-operating adjustment:

Deduct: Non-operating insurance gain

(0.03

)

(0.29

)

Provision for income tax adjustments

0.01

0.07

Adjusted diluted earnings per share - continuing operations (Non-GAAP)

$

1.74

$

1.26

Reconciliation of Adjusted Effective Tax Rate

Effective tax rate (GAAP)

24.9

%

25.9

%

Add/Deduct: Tax impact of non-GAAP adjustments1

—

%

0.2

%

Adjusted effective tax rate (Non-GAAP)

24.9

%

26.1

%

1Relates to the tax effect of non-GAAP adjustments, which were determined based on the nature of the underlying non-GAAP adjustments and their relevant tax rates.

Amounts in tables above may not recalculate due to rounding.

DOLLAR TREE, INC.

Reconciliation of Non-GAAP Financial Measures

(In millions, except per share data)

(Unaudited)

13 Weeks Ended

May 2, 2026

May 3, 2025

Reconciliation of Net Cash Provided by Operating Activities of Continuing Operations to Free Cash Flow from Continuing Operations

Net cash provided by operating activities of continuing operations (GAAP)

$

644.0

$

378.5

Deduct:

Capital expenditures of continuing operations

(252.5

)

(248.8

)

Free cash flow from continuing operations (Non-GAAP)

$

391.5

$

129.7

Net cash used in investing activities of continuing operations (GAAP) (c)

$

(252.9

)

$

(198.9

)

Net cash used in financing activities (GAAP)

$

(100.9

)

$

(439.4

)

(c)

Net cash used in investing activities includes capital expenditures, which is included in our computation of free cash flow.

More News From Dollar Tree, Inc.

Dollar Tree stock was down 22% in 2026 as of Wednesday’s close of trading. (Jake Dockins/Bloomberg)

Dollar Tree was the best performer in the S&P 500 Thursday after the discount retailer reported better-than-expected quarterly earnings, lifted its fiscal-year guidance, and unveiled a partnership with DoorDash.

Dollar Tree, Inc. (NASDAQ:DLTR) shares jumped almost 18% on Thursday morning after the discount retailer reported stronger-than-expected earnings and upwardly revised its full-year profit guidance.

Adjusted earnings per share were $1.74, above analyst expectations of $1.55.

Revenue totaled $4.97 billion, matching consensus estimates and increasing 7.2% year over year. Comparable store sales rose 3.5%, supported by ongoing momentum in the company’s multi-price format expansion.

Dollar Tree also raised its full-year 2026 adjusted EPS outlook to a range of $6.70 to $7.10, above the prior consensus estimate of $6.67. The company said the improved outlook reflects stronger operating performance and continued execution of its strategic initiatives.

The company returned $595 million to shareholders through share repurchases during the first quarter and reported $644 million in net cash provided by operating activities from continuing operations, alongside $392 million in free cash flow.

Dollar Tree also opened 113 new stores and converted or added about 630 locations to its multi-price format, ending the quarter with roughly 5,900 stores in that model.

“Our first quarter results reflect continued progress across the business and demonstrate the strength of Dollar Tree’s position as the preferred destination for value, convenience, and discovery,” Dollar Tree CEO Mike Creedon said.

“As we celebrate our 40th anniversary in 2026, we are encouraged by the progress we are seeing across the business and remain focused on making thoughtful investments in our stores, assortment and customer experience – building Dollar Tree to last for decades to come.”

Stock futures are easing from earlier losses after inflation and GDP data released

For the quarter ended April 2026, Dollar Tree (DLTR - Free Report) reported revenue of $4.97 billion, up 7.2% over the same period last year. EPS came in at $1.74, compared to $1.26 in the year-ago quarter.

The reported revenue represents a surprise of +0.14% over the Zacks Consensus Estimate of $4.96 billion. With the consensus EPS estimate being $1.53, the EPS surprise was +13.5%.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Dollar Tree performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Dollar Tree - Same-Store Net Sales: 3.5% versus 3.4% estimated by seven analysts on average.Dollar Tree - Ending stores: 9,382 versus 9,366 estimated by five analysts on average.Dollar Tree - Selling Square Footage: 83.50 Msq ft compared to the 83.33 Msq ft average estimate based on five analysts.Dollar Tree - New stores: 113 compared to the 103 average estimate based on four analysts.Dollar Tree - Beginning stores: 9,282 versus the four-analyst average estimate of 9,282.Dollar Tree - Number of stores closed: 13 versus the four-analyst average estimate of 19.Revenues- Other revenue: $5.3 million compared to the $3.84 million average estimate based on six analysts. The reported number represents a change of +65.6% year over year.Revenues- Net sales: $4.97 billion versus the six-analyst average estimate of $4.97 billion. The reported number represents a year-over-year change of +7.2%.View all Key Company Metrics for Dollar Tree here>>>

Shares of Dollar Tree have returned +0.2% over the past month versus the Zacks S&P 500 composite's +5% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Dollar Tree, Inc. (NASDAQ:DLTR) shares jumped almost 18% on Thursday morning after the discount retailer reported stronger-than-expected earnings and upwardly revised its full-year profit guidance. Adjusted earnings per share were $1.74, above analyst expectations of $1.55.

Dollar Tree, Inc. delivered a double-line beat, raising its outlook and demonstrating robust sales and margin expansion. Same-store sales grew 3.5%, with a 4.5% increase in average ticket offsetting a 1% decline in traffic. Gross margin expanded 120 basis points to 36.9%, driven by price increases, lower freight, and reduced shrink.

DLTR's Q1 earnings call highlights margin gains from tighter execution and shrink control. It raises the EPS outlook, but warns on fuel, tariffs and traffic.

Dollar Tree beat comparable-sales estimates as average transaction size rose 4.5% despite weaker customer traffic. Summary

Higher-price items are helping Dollar Tree lift spending per visit.

Dollar Tree DLTR gave investors a sharp reminder that value retail still has room to surprise. Comparable sales rose 3.5% in the first quarter, beating estimates, even though customer traffic declined. The driver was larger baskets, with average transaction size climbing 4.5%, suggesting shoppers are spending more when they visit rather than simply showing up in bigger numbers.

That matters because Dollar Tree is no longer leaning only on the old $1 model. The company has been converting stores to carry more products at higher price points, including $3 to $5 items such as toys and party supplies. More than half of its roughly 9,000 locations have already adopted the strategy, giving the chain a wider assortment and possibly helping it pull in deal-seeking shoppers, including higher-income customers, during a period of economic uncertainty.

The market reacted fast. Dollar Tree shares jumped as much as 17%, the stock's largest intraday gain since 2022, after falling 22% this year while the S&P 500 Index SPY gained roughly 10%. The results point to solid demand from higher-income consumers despite higher gas prices, but the broader retail backdrop still carries pressure. Walmart recently warned that higher fuel costs are starting to strain lower-income shoppers, making Dollar Tree's bigger-ticket momentum encouraging, but still worth watching closely.

Investors in Dollar Tree, Inc. (DLTR - Free Report) need to pay close attention to the stock based on moves in the options market lately. That is because the June 18, 2026 $45.00 Call had some of the highest implied volatility of all equity options today.

What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.

What do the Analysts Think?Clearly, options traders are pricing in a big move for Dollar Tree, but what is the fundamental picture for the company? Currently, Dollar Tree is a Zacks Rank #3 (Hold) in the Retail - Discount Stores Industry that ranks in the Top 25% of our Zacks Industry Rank. Over the last 60 days, six analysts have increased their earnings estimate for the current quarter, while one has dropped his estimate. The net effect has taken our Zacks Consensus Estimate for the current quarter to move from $1.04 per share to $1.10 per share in the same time period.

Given the way analysts feel about Dollar Tree right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.