In a tale of two Dollar stores, tariffs play a significant role
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One of the dollar stores imports 40% of its goods, with most coming from China. It’s a tale of two dollar stores this week, as both Dollar Tree (NASDAQ: DLTR) and Dollar General (NYSE: DG) reported first quarter earnings. Both had strong quarters, beating estimates, but only one of them saw its stock price rise, while the other watched its sink. The one that rose was Dollar General, as its stock jumped some 13%, as we covered on Tuesday. The one that sank was Dollar Tree, which dropped some 8% on Wednesday after posting earnings. While there is not one simple answer as to why the divergence, tariffs were certainly a big factor. Dollar General has very little exposure to tariffs, as just 4% of its goods are imported. As a result, Dollar General raised its guidance for the fiscal year, which helped spur the rally. Dollar Tree, on the other hand, imports about 40% of its merchandise, with the vast majority of it coming from China, according to its 2024 annual report. Imports from China are facing 30% tariffs under the latest Trump Administration action and that could impact Dollar Tree’s second quarter earnings. Dollar Tree beats earnings and revenue estimates Overall, Dollar Tree had a strong first quarter, with results beating both revenue and earnings estimates. The company generated $4.6 billion in sales in the quarter, up 11% year over year. That beat revenue estimates of $4.5 billion. Net income from continuing operations rose 17% to $314 million, while earnings increased 20% to $1.47 per share. Adjusted earnings rose 24% to $1.26 per share, which handily beat analysts’ estimates of $1.17 per share. The company also posted an impressive 5.4% increase in same-store sales and opened 148 new Dollar Tree stores in the quarter. In addition, it converted…
Filed under: News - @ June 5, 2025 5:21 am