DLTR
Dollar Tree, Inc.
$94.98
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 47.1% below fair value
You pay
$94.98
Bear
$147.90
Fair
$179.59
Bull
$211.28
Bear
$147.90
+55.7%
$5.94 × 28x P/E
Fair
$179.59
+89.1%
$5.94 × 34x P/E
Bull
$211.28
+122.5%
$5.94 × 40x P/E
Key Value Driver
Normalized P/E multiple (34x base case)
Implied Market Multiple
16.0x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $127.40 from 47 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $179.59 per share.
Warnings
Wall Street's average price target is $127.40 (from 47 analysts). Our estimate is 59% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples