Dollar Tree Tumbles After Lowering Full-Year Earning Expectations trendswire

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Shares of Dollar Tree (NASDAQ:) tumbled more than 11% before trading after missing first-quarter earnings estimates and guidance expectations.

Discount retail earnings of $1.47 per share, $0.05 worse than the analyst estimate of $1.52. However, revenue for the quarter topped estimates of $7.32 billion versus the consensus estimate of $7.28 billion.

The company said it has been affected by external pressures affecting all of retail, “particularly the impact on margin from elevated shrinkage and the shift in product mix to consumables.”

Same-store sales at Dollar Tree increased 3.4%, while the company’s Family Dollar stores saw same-store sales increase 6.6% and Enterprise grew 4.8%.

Dollar Tree has adjusted its EPS outlook as the company expects the high and unfavorable sales mix to persist through the remainder of the year.

EPS for FY24 is now seen between $5.73 and $6.13, against the consensus of $6.68. That is also lower than its previous outlook of between $6.30 and $6.80. Additionally, revenue for the period is expected to be $30 billion to $30.5 billion, versus the consensus of $30.4 billion.

Meanwhile, Q2 EPS is estimated at $0.79-$0.89, vs. consensus of $1.22, and revenue is expected to be between $7.0bn and $7.2bn, vs. consensus of $7.15bn. of dollars.

“We still expect earnings to be charged further this year as the benefits of lower ocean freight rates flow in,” said Rick Dreiling, DLTR President and CEO.