Jim Cramer Says Dollar Tree (DLTR) is a Master “At Finding Low Price Merchandise”

We recently published a list of Jim Cramer’s Game Plan: 9 Stocks in Focus. In this article, we are going to take a look at where Dollar Tree, Inc. (NASDAQ:DLTR) stands against other stocks that Jim Cramer discusses.

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

Discussing how companies that run dollar stores like Dollar Tree, Inc. (NASDAQ:DLTR) might face complications with tariffs on China, Cramer commented:

“Same as Wednesday, when you hear from Dollar Tree and Five Below. Hey man, these are so-called last resort retailers where you go when you have any trouble stretching your budget. They’re masters at finding low-price merchandise, but with the tariffs on China, previously low-cost merchandise, they gotta scramble to find the equivalent from countries that at this point might have more leverage than you’d expect. I mean, they never expected all these orders.

I think all three chains will have good quarters because they were able to bring in a lot of merchandise before the tariffs hit. It’s the guidance I’m worried about because the tariff regime means that either they need to raise prices substantially or accept a much lower level of profitability. Their stocks could be terrible. I wish they could be as adept as Costco, which reported this outstanding number.

But then Costco focuses on a relatively small number of items that it buys in extreme bulk, and it can always swap this stuff out if its suppliers get too greedy. Nobody else has that capability. My hope is that the dollar stores can raise prices once and then keep them there until they find cheaper sources. That might be tough, though, when the White House seems to want everything made here, and anything made here will be more expensive than made there.”

Dollar Tree (NASDAQ:DLTR) operates discount retail stores offering everyday consumables like food, household items, and personal care products, along with toys, housewares, party supplies, and seasonal merchandise for major holidays.

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