Do You Believe in the Upside Potential of Dollar Tree (DLTR)?

Broyhill Asset Management, an investment advisor, released its first quarter 2025 investor letter. A copy of the letter can be downloaded here. Broyhill Partners appreciated 2.8% net of all fees and expenses in the first quarter, surpassing a -1.2% return for the MSCI All Country World Index. Volatility was the dominant theme in the first quarter, particularly among a few US technology companies that have come to influence the performance of passive indices. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its first-quarter 2025 investor letter, Broyhill Asset Management highlighted stocks such as Dollar Tree, Inc. (NASDAQ:DLTR). Dollar Tree, Inc. (NASDAQ:DLTR) is a discount retailer that operates in the Dollar Tree and Family Dollar segments. The one-month return of Dollar Tree, Inc. (NASDAQ:DLTR) was 7.46%, and its shares lost 23.20% of their value over the last 52 weeks. On May 29, 2025, Dollar Tree, Inc. (NASDAQ:DLTR) closed at $90.58 per share, with a market capitalization of $19.035 billion.

Broyhill Asset Management stated the following regarding Dollar Tree, Inc. (NASDAQ:DLTR) in its Q1 2025 investor letter:

“We initiated a new investment in Dollar Tree, Inc. (NASDAQ:DLTR) during the first quarter, as the company’s announced divestiture of Family Dollar put shares back on our radar. We continue to see significant upside potential from the roll-out of higher price points, which should be much clearer to the market without the noise of a decade-long restructuring in the background. Subsequent to quarter-end, and 48 hours after “Liberation Day,” we aggressively increased our position, as shares plummeted ~ 20% in the two days following the announcement.”

Why Dollar Tree Inc. (DLTR) is Skyrocketing?

A shopper browsing through a discount retailers merchandise aisle filled with a wide variety of items.

Dollar Tree, Inc. (NASDAQ:DLTR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 67 hedge fund portfolios held Dollar Tree, Inc. (NASDAQ:DLTR) at the end of the first quarter, which was 64 in the previous quarter. While we acknowledge the potential of Dollar Tree, Inc. (NASDAQ:DLTR) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Dollar Tree, Inc. (NASDAQ:DLTR) and shared the list of best retail stocks to buy. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

Disclosure: None. This article is originally published at Insider Monkey.