Dollar Tree (DLTR), Dollar General (DG): Discount stores remain key gainers in a value-conscious landscape

Discount retailers Dollar Tree, Inc. (NASDAQ: DLTR) and Dollar General Corporation (NYSE: DG) have seen their stocks gain over 30% in the past three months. The dollar stores continue to gain in an uncertain economic environment where customers remain budget-conscious and seek value in their purchases.

One-stop shop for all customers

Dollar Tree and Dollar General are thriving on their ability to offer a wide assortment of products at affordable price points to a broad range of customers. The retailers are attracting customers across all income brackets who are price-sensitive and looking to stretch their budgets. While they are seeing steady demand from their core customers who come from low-to-middle income households, they are also gaining traction with customers from higher-income households.

In the third quarter of 2025, Dollar Tree saw net sales from continuing operations increase 9.4% year-over-year to $4.7 billion. Same-store sales rose 4.2%, fueled mainly by growth in average ticket as traffic declined slightly. Dollar General’s net sales grew 4.6% to $10.6 billion in Q3 2025 versus the previous year. Same-store sales rose 2.5%, driven by a rise in traffic while average transaction amount stayed flat.

The retailers are seeing growth in both the consumables and discretionary categories, with the latter now outpacing the former. DLTR saw comps grow 4.8% in discretionary and 3.5% in consumables in Q3. DG also saw comp sales growth in non-consumables surpass consumables.

Dollar Tree saw gross margin increase 40 basis points to 35.8%, driven by lower costs and favorable sales mix. Dollar General’s gross margin expanded 107 basis points to 29.9%, driven by higher inventory mark-ups and lower shrink. DLTR’s adjusted earnings per share grew 12% to $1.21 while DG’s EPS grew nearly 44% to $1.28 in Q3.

More room for growth

Dollar Tree sees significant room for growth with higher income customers. Despite their higher income, larger average basket size and ability to spend more, the average per household spend for higher-income customers is low and the company believes this is due to trip frequency. DLTR