Dollar Tree
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Does this company strike you guys as a good investment? 17 p/e's, buying back shares, low debt, good cash flow, but no dividends.
Thanks
Ace
Ace: I don’t know about Dollar Tree but I wouldn’t buy ANYTHING @ greater than mkt. PE or less than a mkt. yield. Benchmark now @ 15-16 PE and 1.9% yield (S&P). 14 fwd. PE if you believe the bulls.
I think there is more to look at than P/E and dividend. We are moving
into a time when lower quality growth stocks will out perform. I
don’t know about Dollar Tree, but I do like companies that have an
aggressive outlook and earnings growth expectations are high.
considering HNW clients would prefer share buy-backs to dividends, if they're aggressive enough, does dividend really matter? With almost no debt, DLTR appears to be a good bargain.
Plus, what a name.
Ace
I guess the real question is: Is DLTR a good long term buy, or is the valuation fundamentally flawed in some way?
Ace
My clients all shop at Dollar Tree. It is actually two doors down from my office on the other sid of the Chiropractor.
[quote=Incredble Hulk]My clients all shop at Dollar Tree. It is actually two doors down from my office on the other sid of the Chiropractor.[/quote]
...you're killing me again, man...
[quote=Ace Planner]
I guess the real question is: Is DLTR a good long term buy, or is the valuation fundamentally flawed in some way?
Ace
[/quote]YES!
Joe, that was deep. So you're saying while it may be a good long term buy, it's not at this price. Whoa, how do you do it?
Ace
PS Thanks for the laughs Incredble Hulk.
[quote=Ace Planner]
considering HNW clients would prefer share buy-backs to dividends, if they're aggressive enough, does dividend really matter? With almost no debt, DLTR appears to be a good bargain.
Plus, what a name.
Ace
[/quote] Again, don't follow Dollar Tree. Dividends DO matter. Only about 60-70% of total market return of stock market past 70 yrs. My HNW clients understand that dividends are treated the same as LT cap. gains. 15% max tax. Further, stock buybacks don't put mgmt. on same side of table as shareholders. Most buybacks are instituted to satisfy option grants (what a cruel joke). DELL is the poster boy for that game.Revealer, good answer, but I'd have to argue that capital gains deferred are sometimes better than taken now.
Ace