Dollar Tree (DLTR) stock was up 4% on Wednesday after the discount retailer beat Wall Street’s key metrics, adjusted earnings, revenue, and same-store sales growth.
Revenue grew 9.4% to $4.75 billion, slightly higher compared to the Street’s expectations of $4.7 billion, per Bloomberg consensus data. Adjusted earnings per share came in at $1.21, significantly higher than the expected $1.10. Same-store sales grew by 4.2%, more than the 4% increase expected. The average ticket increased 4.5%, partly offset by the traffic decline of 0.3%
“All consumers are seeking value, marrying that value-seeking behavior with convenience and discovery is the intersection where Dollar Tree thrives,” CEO Michael Creedon said to investors in its earnings call.
He said 3 million more households are now part of its customer base compared to last year, with high-income consumers, who earn more than $100,000 per year, making up the majority of new customers.
Meanwhile, 30% of new customers are from middle-income households, those earning between $60,000 and $100,000. The remaining 10% are from lower-income households, which earn less than $60,000.
The company also raised its profit outlook. It now expects adjusted earnings to come in the range of $5.60 to $5.80 for the full year, up from $5.32 to $5.72.
In the fourth quarter, the company now expects same-store sales to increase 4% to 6%. For the full year, same-store sales are expected to rise between 5% to 5.5%.
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