Price to Operating Profit (P/OP)
since 2005
Calculation
Dollar Tree Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Operating income (loss)1 (in thousands) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Mar 15, 2022 | 18.77 | = | 151.06 | ÷ | 8.05 | 8.05 | = | 1,811,400 | ÷ | 225,110,329 | |
| Mar 16, 2021 | 13.48 | = | 109.04 | ÷ | 8.09 | 8.09 | = | 1,887,900 | ÷ | 233,420,925 | |
| Mar 20, 2020 | 14.25 | = | 75.97 | ÷ | 5.33 | 5.33 | = | 1,262,200 | ÷ | 236,810,841 | |
| Mar 27, 2019 | — | = | 104.22 | ÷ | -3.94 | -3.94 | = | -939,500 | ÷ | 238,204,351 | |
| Mar 16, 2018 | 11.37 | = | 95.75 | ÷ | 8.42 | 8.42 | = | 1,999,100 | ÷ | 237,335,999 | |
| Mar 28, 2017 | 10.61 | = | 76.55 | ÷ | 7.21 | 7.21 | = | 1,704,800 | ÷ | 236,297,936 | |
| Mar 28, 2016 | 18.11 | = | 80.84 | ÷ | 4.46 | 4.46 | = | 1,049,700 | ÷ | 235,182,732 | |
| Mar 13, 2015 | 16.20 | = | 81.91 | ÷ | 5.06 | 5.06 | = | 1,040,200 | ÷ | 205,759,864 | |
| Mar 14, 2014 | 11.46 | = | 53.92 | ÷ | 4.71 | 4.71 | = | 970,300 | ÷ | 206,224,996 | |
| Mar 15, 2013 | 10.80 | = | 44.24 | ÷ | 4.10 | 4.10 | = | 920,100 | ÷ | 224,590,879 | |
| Mar 15, 2012 | 13.83 | = | 46.76 | ÷ | 3.38 | 3.38 | = | 782,100 | ÷ | 231,305,516 | |
| Mar 17, 2011 | 10.33 | = | 26.67 | ÷ | 2.58 | 2.58 | = | 630,000 | ÷ | 244,082,432 | |
| Mar 19, 2010 | 9.62 | = | 18.81 | ÷ | 1.96 | 1.96 | = | 512,800 | ÷ | 262,266,768 | |
| Mar 26, 2009 | 10.81 | = | 14.58 | ÷ | 1.35 | 1.35 | = | 365,800 | ÷ | 271,146,258 | |
| Apr 1, 2008 | 7.92 | = | 9.71 | ÷ | 1.23 | 1.23 | = | 330,300 | ÷ | 269,424,370 | |
| Apr 4, 2007 | 12.10 | = | 12.76 | ÷ | 1.05 | 1.05 | = | 310,800 | ÷ | 294,753,874 | |
| Apr 12, 2006 | 9.74 | = | 8.68 | ÷ | 0.89 | 0.89 | = | 283,239 | ÷ | 317,887,282 | |
| Apr 14, 2005 | 9.26 | = | 8.31 | ÷ | 0.90 | 0.90 | = | 293,551 | ÷ | 327,282,888 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28), 10-K (reporting date: 2016-01-30), 10-K (reporting date: 2015-01-31), 10-K (reporting date: 2014-02-01), 10-K (reporting date: 2013-02-02), 10-K (reporting date: 2012-01-28), 10-K (reporting date: 2011-01-29), 10-K (reporting date: 2010-01-30), 10-K (reporting date: 2009-01-31), 10-K (reporting date: 2008-02-02), 10-K (reporting date: 2007-02-03), 10-K (reporting date: 2006-01-28), 10-K (reporting date: 2005-01-29).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of Dollar Tree Inc. Annual Report.
The share price and operating profit per share exhibited a strong long-term growth trajectory between 2005 and 2022. The share price ascended from 8.31 USD to 151.06 USD, while the operating profit per share increased from 0.90 USD to 8.05 USD, notwithstanding a severe contraction in 2019.
- P/OP Ratio Trend Analysis
- The Price to Operating Profit (P/OP) ratio demonstrated significant volatility, ranging from a low of 7.92 in 2008 to a peak of 18.77 in 2022. From 2005 to 2014, the ratio largely oscillated within a band of 8x to 14x, suggesting a period of relative valuation stability.
- Valuation Expansion and Correction
- A distinct valuation peak occurred between 2015 and 2016, with the P/OP ratio rising to 16.20 and 18.11 respectively. This expansion was followed by a correction in 2017 and 2018, during which the ratio reset to levels between 10.61 and 11.37.
- Operational Anomaly and Recovery
- The 2019 fiscal period was characterized by a significant operational downturn, with operating profit per share falling to -3.94 USD. This negative result rendered the P/OP ratio unavailable for that year. However, a recovery was observed by 2020, as operating profit per share returned to 5.33 USD.
- Recent Valuation Trajectory
- From 2020 to 2022, a consistent upward trend in the P/OP ratio is evident, increasing from 14.25 to 18.77. This indicates that the market began assigning a higher multiple to the company's operating profits toward the end of the observed period, reaching the highest valuation multiple in the 17-year history analyzed.
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Comparison to Competitors
Dollar Tree Inc., P/OP, long-term trends, comparison to competitors
| Dollar Tree Inc. | Costco Wholesale Corp. | Target Corp. | Walmart Inc. | |
|---|---|---|---|---|
| Mar 15, 2022 | 18.77 | 27.28 | 11.17 | 15.43 |
| Mar 16, 2021 | 13.48 | 29.60 | 13.62 | 16.46 |
| Mar 20, 2020 | 14.25 | 29.47 | 11.35 | 15.69 |
| Mar 27, 2019 | — | 27.62 | 9.69 | 12.70 |
| Mar 16, 2018 | 11.37 | 21.34 | 8.83 | 12.85 |
| Mar 28, 2017 | 10.61 | 16.75 | 6.12 | 9.61 |
| Mar 28, 2016 | 18.11 | 17.91 | 8.88 | 8.97 |
| Mar 13, 2015 | 16.20 | 18.09 | 11.20 | 9.59 |
| Mar 14, 2014 | 11.46 | 16.90 | 8.89 | 9.15 |
| Mar 15, 2013 | 10.80 | 16.80 | 8.18 | 8.85 |
| Mar 15, 2012 | 13.83 | 14.86 | 7.38 | 7.83 |
| Mar 17, 2011 | 10.33 | 14.53 | 6.80 | 7.16 |
| Mar 19, 2010 | 9.62 | 13.16 | 8.40 | 8.78 |
| Mar 26, 2009 | 10.81 | 14.35 | 5.12 | 9.07 |
| Apr 1, 2008 | 7.92 | 12.67 | 7.80 | 9.47 |
| Apr 4, 2007 | 12.10 | 17.49 | 10.09 | 9.56 |
| Apr 12, 2006 | 9.74 | 15.05 | 10.40 | 10.81 |
| Apr 14, 2005 | 9.26 | 16.03 | 12.23 | 12.41 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28), 10-K (reporting date: 2016-01-30), 10-K (reporting date: 2015-01-31), 10-K (reporting date: 2014-02-01), 10-K (reporting date: 2013-02-02), 10-K (reporting date: 2012-01-28), 10-K (reporting date: 2011-01-29), 10-K (reporting date: 2010-01-30), 10-K (reporting date: 2009-01-31), 10-K (reporting date: 2008-02-02), 10-K (reporting date: 2007-02-03), 10-K (reporting date: 2006-01-28), 10-K (reporting date: 2005-01-29).