Top 8 Discount Stores Stocks For 2025

5. Dollar Tree Inc. (NASDAQ:DLTR)

Dollar Tree Inc. operates a chain of discount retail stores and offers a wide range of products including household, personal care, food, health, and other general merchandise. The company has two main business units; Family Dollar and Dollar Tree. It has a unique business model where merchandise is priced at a fixed rate of  $1.25 in its dollar tree segment.  A 45% decline in share price within a year suggests low-income households, the company’s primary target market, aren’t doing well with disposable income.

Dollar Tree continues to be dragged down by the struggling Family Dollar business. The acquisition that was signed just over 10 years ago is now a big headache for DLTR.  At that time, Family Dollar was a much bigger network than Dollar Tree’s own stores. We now see that the company was unable to handle this increasing demand from a management perspective. To make matters worse, further expansion ended up hurting the existing stores.

The company will have to learn how to survive in the tough macroeconomic environment rather than relying on government programs for low-income households or improving macro. Unlike Dollar General (DG), which is also facing similar struggles, DLTR’s management doesn’t inspire a lot of confidence among investors. There’s a certain risk associated with this investment, and the reward isn’t very attractive.