BUZZ-JPM upgrades Dollar Tree on Family Dollar stores' optimization potential
Reuters · 01/29 10:47
BUZZ-JPM upgrades Dollar Tree on Family Dollar stores' optimization potential

** JPMorgan raises retailer Dollar Tree's DLTR.O rating to "overweight" from "", while lifting PT to $157 from $122, representing an 18.3% upside to stock's last close

** Says Family Dollar banner's store optimization will change investment to a potential "win-win" catalyst path in FY 2024 for DLTR

** Notes in meeting with management, CEO cited deflation as a potential multi-year merchandising opportunity for Dollar Tree banner allowing product reinvestment on quality/pack size and re-introduction of items discontinued given inflationary pressure

** JPM says its model reflects an 18% EPS growth over the 3 years to $9.75 for DLTR

** Brokerage also raises PT on rival Dollar General DG.N to $120 from $108 citing sequential improvement in turnaround strategy at stores that can lead to progress in FY 2024

** New PT represents a 10% downside to stock's last close

** In 2023, DLTR gained 0.4%, while DG dropped 45%


(Reporting by Granth Vanaik in Bengaluru)

((Granth.Vanaik@thomsonreuters.com; Twitter: https://twitter.com/Vanaik_Granth;))