Dollar Tree Rises as Family Dollar Acquisition Boosts ResultsBy
Dollar Tree Inc. rose the most in almost six months after the discount retailer boosted its forecast for earnings, helped by last year’s acquisition of rival Family Dollar.
Profit will be $1.24 to $1.33 a share in the quarter through January, up from a previous forecast of $1.21 to $1.30, the Chesapeake, Virginia-based company said in a statement Tuesday. Analysts estimated $1.30, on average.
Dollar Tree’s management said on a conference call that the company expects to surpass its target for wringing savings out of the Family Dollar chain it bought for about $9 billion. The deal, which came after a protracted bidding war with Dollar General Corp., made Dollar Tree the largest U.S. dollar-store chain. The company ended last quarter with almost 14,300 locations.
The shares advanced as much as 11 percent to $91.41 in New York, the biggest intraday gain since May 26. Dollar Tree already had climbed 6.2 percent this year through Monday.