Yahoo Finance Dollar Tree (NASDAQ:DLTR) shareholder returns have been notable, earning 61% in 3 years
By buying an index fund, you can roughly match the market return with ease. But if you pick the right individual stocks, you could make more than that. For example, the Dollar Tree, Inc. (NASDAQ:DLTR) share price is up 61% in the last three years, clearly besting the market return of around 17% (not including dividends). On the other hand, the returns haven't been quite so good recently, with shareholders up just 7.4%.
The past week has proven to be lucrative for Dollar Tree investors, so let's see if fundamentals drove the company's three-year performance.
Check out our latest analysis for Dollar Tree
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
Dollar Tree became profitable within the last three years. That would generally be considered a positive, so we'd expect the share price to be up.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
It is of course excellent to see how Dollar Tree has grown profits over the years, but the future is more important for shareholders. If you are thinking of buying or selling Dollar Tree stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
It's good to see that Dollar Tree has rewarded shareholders with a total shareholder return of 7.4% in the last twelve months. That's better than the annualised return of 5% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Dollar Tree better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Dollar Tree you should know about.
Of course Dollar Tree may not be the best stock to buy. So you may wish to see this free collection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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