Shares of Dollar Tree Inc. (NASDAQ:DLTR) moved lower in premarket trading Monday even after the retailer reported fourth-quarter results that topped Wall Street forecasts, as investors reacted negatively to the company’s guidance for fiscal 2026.
The stock was down about 3% before the market open. For the quarter ended January 31, the discount retailer reported adjusted earnings per share of $2.56, exceeding analyst expectations of $2.53 by $0.03. Revenue totaled $5.5 billion, ahead of the $5.46 billion consensus estimate and up 9% from the same period a year earlier.
Comparable store net sales increased 5% during the quarter, supported by a 6.3% rise in the average customer transaction, although this was partly offset by a 1.2% drop in store traffic.
Despite the stronger-than-expected quarterly results, Dollar Tree’s forecast for fiscal 2026 disappointed investors. The company projected adjusted EPS between $6.50 and $6.90, with a midpoint of $6.70—below the analyst consensus of $6.74. It also expects annual revenue in the range of $20.5 billion to $20.7 billion, with the midpoint of $20.6 billion slightly under the $20.69 billion market forecast.
For the first quarter, Dollar Tree anticipates adjusted EPS of $1.45 to $1.60 and comparable store net sales growth of between 3% and 4%.
“Our strong results this quarter show that Dollar Tree remains America’s retail destination for value, convenience, and discovery – underscored by our 20th consecutive year of positive same store sales,” said Mike Creedon, Chief Executive Officer.
Gross profit margin improved by 150 basis points to 39.1% in the quarter, mainly due to better pricing strategies and reduced freight costs, though these gains were partly offset by higher tariff-related expenses. Operating income rose 30.2% year over year to $695 million.
For the full fiscal year 2025, Dollar Tree reported net sales of $19.4 billion, representing a 10.4% increase compared with the previous year, while comparable store sales grew 5.3%.