Disney (DIS) and 4 Other Stocks Billionaire Phill Gross Was Buying Up in Q1.

1. Dollar Tree, Inc. (NASDAQ:DLTR)

Value of Adage Capital Management’s 13F Position: $549 million

Number of Hedge Fund Shareholders: 41

Topping the list is Dollar Tree, Inc. (NASDAQ:DLTR), which Adage Capital Management owns 3.43 million shares of as of March 31, a 68% increase from a quarter earlier. Other hedge funds appear to have sold out of Dollar Tree too early, as ownership of the stock has fallen by 31% since mid-2020 while shares have soared by more than 60% during that time.

Phill Gross appears to be bullish on discount retailers like Dollar Tree, Inc. (NASDAQ:DLTR) and Burlington Stores given the challenging economic environment. Unlike the latter, Dollar Tree had a strong first quarter that sent shares surging by 29% between May 20 and May 27. Same-store sales grew by 4.4% year-over-year during the quarter, while margins remained strong despite rising freight costs.

Several of Dollar Tree, Inc. (NASDAQ:DLTR)’s pricing initiatives have had a positive impact on traffic and sales, namely the introduction of a $1.25 price point, which allowed the company to reintroduce several popular products that had been discontinued due to their previous $1.00 pricing constraint. On the upper end, Dollar Tree is also expanding the assortment of items it sells for between $3 and $5, which boosted revenue and margins.

Dollar Tree raised its 2022 guidance following its strong Q1, with the company now anticipating between $27.76 billion and $28.14 billion in consolidated net sales for the year, as well as earnings of between $7.80 and $8.20 per share.

For more on the latest trading activity made by some of the biggest hedge fund managers and investors in the world, check out why Investors are Watching These 10 Biotech Stocks and why Jim Cramer Recommends These 10 Stocks for Recession.

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