Dollar Tree (DLTR) reported fiscal Q4 results and 2026 guidance in line with expectations, with Truist Securities noting in a Monday research note that traffic declined in the quarter but improved sequentially and is expected to turn positive later in the year.

The brokerage said the traffic is likely to accelerate as Dollar Tree enhances store standards and optimizes inventory and the company's shift toward larger like-for-like product formats may temporarily boost ticket sales while normalizing transactions. The investment firm noted that calendar year 2026 guidance assumes transactions will turn positive.

Truist maintained its 2026 and 2027 earnings per share estimates for the company at $6.75 and $7.50. The investment firm highlighted that traffic improvements, discretionary mix and buybacks could drive earnings growth despite near-term traffic concerns.

Analysts also said Dollar Tree's value positioning, limited SKU overlap and strategic pricing should support traffic growth. The company is projecting positive transactions and 2026 same-store sales between 3% and 4%.

Truist kept its buy rating on the stock and lowered its price target to $142 from $156.

Shares of the company were up nearly 6% in Monday trading.

Price: 113.52, Change: +6.06, Percent Change: +5.64