ALBAWABA - Dollar Tree Inc.'s stock fell sharply on Wednesday after the bargain retailer's fiscal fourth-quarter earnings forecast fell below estimates, with a plan to close 30 Dollar Tree stores as leases expire, 600 Family Dollar stores in the first half of 2024 and 370 more in the upcoming years as lease contracts expire, as reported by CNN.
Dollar Tree stock price has dropped 7.8 percent in premarket trading, according to Morning Star, as the company reported a net loss of $1.71 billion in the last quarter all the way down from a from net income of $452.2 million reported last year.
In 2015, Dollar Tree invested $8.5 billion to acquire Family Dollar. By coming together, the merged business sought to increase its clientele, save expenses, and deter larger shops. However, analysts believe that when Dollar Tree purchased the company in 2015, multiple Family Dollar locations were in a state of decline and neglect.
Despite the fact that Family Dollar has recently refurbished hundreds of shops, numerous locations operating under both brands continue to get inadequate maintenance, and many of them have issues with clients’ and staff health and safety.
CNN adds that Family Dollar was charged with an unprecedented penalty this year for selling goods that were kept in a warehouse swarming with dead, alive, and decomposing mice, in violation of product safety regulations. According to the Justice Department, the $41.6 million fine was "the largest-ever monetary criminal penalty in a food safety case."
