Dollar Tree Stores (DLTR): Stock With Unusual Social Activity - TheStreet

Trade-Ideas LLC identified

Dollar Tree Stores

(

DLTR

) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Dollar Tree Stores as such a stock due to the following factors:

  • DLTR has more that 20x the normal benchmarked social activity for this time of the day compared to its average of 4.65 mentions/day.
  • DLTR has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $270.2 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on DLTR:

Dollar Tree, Inc. operates discount variety stores in the United States and Canada. Its stores offer merchandise at the fixed price of $1.00. DLTR has a PE ratio of 44. Currently there are 12 analysts that rate Dollar Tree Stores a buy, 1 analyst rates it a sell, and 8 rate it a hold.

The average volume for Dollar Tree Stores has been 3.9 million shares per day over the past 30 days. Dollar Tree Stores has a market cap of $15.8 billion and is part of the services sector and retail industry. The stock has a beta of 0.64 and a short float of 6% with 3.15 days to cover. Shares are down 2.8% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Dollar Tree Stores as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 6.0%. Since the same quarter one year prior, revenues rose by 48.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry, implying reduced upside potential.
  • DOLLAR TREE INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, DOLLAR TREE INC increased its bottom line by earning $2.90 versus $2.75 in the prior year. For the next year, the market is expecting a contraction of 3.4% in earnings ($2.80 versus $2.90).
  • The gross profit margin for DOLLAR TREE INC is currently lower than what is desirable, coming in at 31.37%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -3.25% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$175.50 million or 205.02% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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