– Markets expect DLTR to see Adjusted ROA fade from current high 12% levels to near cycle-low levels of 8% over the next five years, levels only seen twice in the past 15 years

– Management is confident about gross margin and SG&A improvements, their assortment, and the consolidation of services shared with Family Dollar, which should help them maintain current margins and turns to beat market expectations

– DLTR currently trades at a 2.1x Adjusted P/B metric, which is in line with its peer group, but with far stronger growth prospects, further signaling the potential for multiple expansion with limited equity downside

– DLTR’s returns are materially distorted by how as-reported GAAP accounting treats operating leases as an expense as opposed to an investment, and by how GAAP accounting understates earnings around acquisitions


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