DLTR
Dollar Tree, Inc.
$124.56
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Undervalued
Trading 30.1% below fair value
You pay
$124.56
Bear
$146.76
Fair
$178.21
Bull
$209.66
Bear
$146.76
+17.8%
$5.94 × 28x P/E
Fair
$178.21
+43.1%
$5.94 × 34x P/E
Bull
$209.66
+68.3%
$5.94 × 40x P/E
Key Value Driver
Normalized P/E multiple (34x base case)
Implied Market Multiple
21.0x
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 $122.80 from 49 analysts, using a 30% weight on analyst consensus. That produces an estimated intrinsic value of $178.21 per share.
Warnings
Wall Street's average price target is $122.80 (from 49 analysts). Our estimate is 64% 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