Dollar Tree, Inc. (DLTR): Looking for a Safe Long-Term Investment?

If you’re wondering about historical stock performance, the chart below compares these three companies over the past five years:

DLTR data by YCharts

Yes, Dollar Tree is the most impressive. And yes, these stocks also perform well in bull markets.

We have established that Dollar Tree, Inc. (NASDAQ:DLTR) is a strong option, but Dollar General and Family Dollar Stores, Inc. (NYSE:FDO) are no slouches, either. Both are trading at 17 times earnings, making them fairly valued.

Dollar General Corp. (NYSE:DG) operates 10,700 stores across the country, giving it more locations than any other retailer. Needless to say, exposure isn’t a concern. Dollar General also consistently buys back shares, which is bullish for investors as it decreases the share count. However, Dollar General Corp. (NYSE:DG) recently lowered guidance, which potentially makes it the weakest option of this group.

Family Dollar Stores, Inc. (NYSE:FDO) is the smallest of the three retailers, but it’s also extremely efficient. It’s strategy is simply to build small stores in highly populated areas. This game plan has led to great success over the years, and there is no reason for the trend to stop.

Conclusion

It would be difficult to go wrong with any of these investments over the long haul. While short-term fluctuations are possible, any downward stock momentum can be looked at as an opportunity to add to a position. Based on fundamentals and past performance, Dollar Tree, Inc. (NASDAQ:DLTR) looks to be the best of the bunch.

Dan Moskowitz has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article Looking for a Safe Long-Term Investment? originally appeared on Fool.com.

Dan is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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