Dollar Tree beats estimates, to expand into higher-priced items
Reuters
Published Nov 24, 2020 08:05AM ET
Updated Nov 24, 2020 08:45AM ET
(Reuters) - Dollar Tree Inc (NASDAQ:DLTR) reported better-than-expected quarterly results on Tuesday, as the discount store operator benefited from higher demand for cheaper groceries and household items during a coronavirus-induced economic downturn.
Shares of Dollar Tree gained 6.3% in premarket trading as the company also said it would expand its higher-priced offering, Dollar Tree Plus, into about 500 stores starting in the spring of 2021, after an initial test in more than 100 stores.
The announcement comes after rival Dollar General (NYSE:DG) unveiled the launch of Popshelf stores, which are aimed at consumers spending more on non-essential items priced at $5 or less.
Sales at dollar stores, which typically sell products at $1, have remained strong even after the initial panic-buying at the start of lockdowns, with high U.S. unemployment and falling household income boosting demand for affordable cereals and vegetables.
Dollar Tree Chief Executive Officer Mike Witynski said the chain was off to a good start to its holiday quarter, with same-store sales at both its labels tracking above their third-quarter levels.
Same-store sales at the company's eponymous business increased 4% in the quarter ended Oct. 31, while they rose 6.4% at Family Dollar stores.
Net income rose to $330 million, or $1.39 per share, from $255.8 million, or $1.08 per share, a year earlier. Analysts on average were expecting a profit of $1.15 per share, Refinitiv IBES data showed.
Net sales rose 7.5% to $6.18 billion, beating expectations of $6.13 billion.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.