Today we're going to take a look at the well-established Dollar Tree, Inc. (NASDAQ:DLTR). The company's stock saw significant share price movement during recent months on the NASDAQGS, rising to highs of US$76.61 and falling to the lows of US$66.68. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Dollar Tree's current trading price of US$70.16 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Dollar Tree’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Dollar Tree

Is Dollar Tree Still Cheap?

Great news for investors – Dollar Tree is still trading at a fairly cheap price. According to our valuation, the intrinsic value for the stock is $92.92, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. What’s more interesting is that, Dollar Tree’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

Can we expect growth from Dollar Tree?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with a relatively muted revenue growth of 9.6% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Dollar Tree, at least in the short term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since DLTR is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on DLTR for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy DLTR. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.

Since timing is quite important when it comes to individual stock picking, it's worth taking a look at what those latest analysts forecasts are. So feel free to check out our free graph representing analyst forecasts.

If you are no longer interested in Dollar Tree, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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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.