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Dollar Tree’s Prices Set to Rise Soon

Shares of Dollar Tree experienced a significant drop in September, but they have since rebounded and are expected to continue rising. Goldman Sachs predicts further gains for the company. Dollar Tree, once considered a top stock during a recession, has faced challenges since the summer. The poor end to the summer saw a more than 30% drop in their shares, bringing them back to 2017 levels. The company’s margins also suffered, resulting in lower forward guidance than analysts had anticipated. However, the recent rally suggests that the negative sentiment was overdone, and Goldman Sachs is optimistic about Dollar Tree’s prospects. They believe the company will continue to capture market share, supported by improving traffic trends and a loyal customer base. Additionally, the improving discretionary cash flow outlook for lower and middle-income consumers is expected to drive earnings growth. Goldman Sachs projects an annual earnings growth rate of 19% through 2026, outperforming its peer group. The target price for Dollar Tree’s stock is set at $137, representing a potential 20% upside. The next earnings report, scheduled for the second half of November, will be crucial in determining the stock’s future trajectory. Analysts will be monitoring the company’s margins and revenue performance. With Goldman Sachs bullish on Dollar Tree, the stock is likely to see continued momentum. Investors may consider getting involved before the earnings report, taking the opportunity to sell some shares or stay invested in anticipation of positive news. While Dollar Tree currently has a “Moderate Buy” rating, there are other stocks that top-rated analysts believe are better options.

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