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Dollar Tree can emerge as a winner in the global trade war, according to Citi. Analyst Paul Lejuez upgraded shares of the discount retailer to buy from neutral. He also lifted his price target to $103 from $76, implying upside of more than 50%. Global investors have been fretting over the impact of President Donald Trump’s tariffs on the global economy, leading them to dump equities. A unilateral 10% duty took effect Saturday, with more set to take hold this week. But Lejuez sees Dollar Tree as a “dark horse winner.” “With ~50% of its product subject to significantly higher tariffs, the market reaction and investor instinct was extremely and unsurprisingly negative. However, we believe this higher-tariff-across-the-board environment is going to be a positive for DLTR,” he wrote. Lejuez said consumers will be “accepting” of a price increase on products to $1.50-$1.75 from about a current price point of around $1.25. “Keep in mind DLTR has already been on a path of increasing price points within its assortment as part of the Dollar Tree Plus/ Multi-price 3.0 initiative, which includes moving to price points of $2-$5. So a $1.50 or $1.75 price shouldn’t cause sticker shock,” he said. “We believe the current environment is ideal for DLTR’s value proposition to thrive,” Lejuez added. “We believe it is worth pointing out that Dollar Tree has comped positive every year since 2005 (thru all economic environments, including 2008-2009, 2020-2021), as consumers have gravitated towards retailers with mindshare for value, especially during difficult times.” Shares rose slightly in the premarket following the upgrade, bucking the broader market trend seen Monday. Year to date, the stock is down about 10%. DLTR 1Y mountain DLTR 1Y chart Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today’s dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You’ll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
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