: Dollar Tree’s stock drops after earnings, sales miss expectations amid softer demand

Shares of Dollar Tree Inc. DLTR sank 2.5% in premarket trading Wednesday, after the discount retailer missed fiscal third-quarter earnings and sales expectations, but provided an in-line outlook for the current quarter. Net income for the quarter to Oct. 28 fell to $212.0 million, or 97 cents a share, from $266.9 million, or $1.20 a share, in the year-ago period. The FactSet consensus for earnings per share was $1.01. Total revenue grew 5.4% to $7.31 billion, below the FactSet consensus of $7.40 billion. Same-store sales increased 3.9% to miss expectations of 5.3% growth, as Dollar Tree same-store sales rose 56.4% and Family Dollar same-store sales increased 2.0%. For the fourth quarter, the company expects net sales of $8.6 billion to $8.8 billion, surrounding the FactSet consensus of $8.73 billion. “Our current outlook takes into consideration several factors including continuing strength at the Dollar Tree banner, incremental freight savings, softer demand from low-income households, and a continuation of the shrink and sales mix headwinds we have seen throughout the year,” said Chief Financial Officer Jeff Davis. The stock has shed 5.7% over the past three months through Tuesday, while the S&P 500 SPX has gained 1.3%.

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