Dollar stores companies were some best performing stocks in the S&P 500 during the Great Recession, said Piper Sandler managing director Peter Keith.
Shares of Dollar Tree — which owns its namesake brand and Family Dollar — and Dollar General have both fallen roughly 50% this year.
Lower income Americans, who comprise about 60% of Dollar General sales, are under more pressure to stretch their dollars in the face of high inflation.
In its fiscal 2024 second quarter earnings call, Dollar General said those customers are also more reliant on online storefronts, which dollar stores have had less success in rolling out.
Both Dollar Tree and Dollar General have also faced numerous worker safety violations over the past decade.
Persons:
Piper Sandler, Peter Keith, Keith, Melissa Repko
Organizations:
Walmart, CNBC