10 Oversold NASDAQ Stocks To Invest In Now

2. Dollar Tree, Inc. (NASDAQ:DLTR)  

Number of Hedge Fund Investors: 38  

Forward P/E Ratio as of October 23: 11.04  

YTD Performance as of October 23: -52.88%  

Dollar Tree, Inc. (NASDAQ:DLTR) is an American discount retail chain operating under the brands names Dollar Tree, Family Dollar, and Dollar Tree Canada.  The company operates over 16,000 stores across the U.S. and Canada. Dollar Tree sells consumables such as food, health products, and household items, along with seasonal merchandise. Family Dollar caters to a broader customer base, providing general merchandise that includes apparel, electronics, and school supplies.

Dollar Tree, Inc. (NASDAQ:DLTR) has faced challenges in the retail market due to a decline in discretionary spending as consumers prioritize essentials. On the positive side, Family Dollar saw an improvement in discretionary spending in the second quarter, and lower payroll expenses are anticipated in the near future. For Q3, net sales are projected to range between $7.4 billion and $7.6 billion, with adjusted EPS forecasted between $1.05 and $1.15. For the full year, net sales are expected to be between $30.6 billion and $30.9 billion, with adjusted EPS estimated between $5.20 and $5.60, a decrease from the previous midpoint estimate of $6.75.

Growing competition has also led the company to reevaluate its strategy. In late 2023, the company conducted a review of its store portfolio and decided to close approximately 970 underperforming stores. Dollar Tree, Inc. (NASDAQ:DLTR) is focusing on both opening new stores and converting existing ones to newer formats, such as the multi-price store format. The multi-price rollout, which has been successful in driving revenue and margin improvement, is expected to be fully rolled out by early 2025.

Dollar Tree, Inc. (NASDAQ:DLTR) unique strengths, including its loyal customer base and efficient operations, could enable it to compete effectively. Furthermore, Dollar Tree, Inc. (NASDAQ:DLTR)  is strategically reviewing Family Dollar, which could potentially result in a sale, spin off or other disposition of the business.