Insider Activity Report: Dollar Tree (DLTR)

Jeffrey Davis, CFO of Dollar Tree (DLTR), recently bought 1,800 shares. The buy increased his position by 10%, and came to a total cost of $244,794.

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  • This buy follows up on a director buy in March for 1,000 shares at $127,850. Going further back, insider activity has been a bit more mixed, but the company CEO was a buyer of just over $1 million in shares a year ago.

    Overall, Dollar Tree insiders own 0.3% of shares.

    The discount retail chain is down about 10% over the past year.

    Rising costs and low margins for dollar store chains have weighed on shares overall, as well as increased shrinkage from retail theft rings. While revenues rose 11% in the past 12 months, earnings have declined and the company had an overall loss.

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  • Nevertheless, Dollar Tree now trades at about 20 times forward earnings, and at one times its price-to-sales ratio.

    Action to take: Dollar Tree shares have been trending higher since September, and look attractive as a momentum investment. The stock recently pulled back after earnings, but appears to be resuming its long-term uptrend.

    For traders, the August $140 calls, last trading for about $7.95, could see mid-to-high double-digit returns in the coming months.

    Traders may want to take a quick profit if shares have any big one-day jump higher.


    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.

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