4-Star Stocks Poised to Pop: Dollar Tree

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Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, discount variety store operator Dollar Tree (NAS: DLTR) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Dollar Tree's business and see what CAPS investors are saying about the stock right now.

Dollar Tree facts

Headquarters (founded)Chesapeake, Va. (1986)
Market Cap$11.9 billion
IndustryGeneral merchandise stores
Trailing-12-Month Revenue$6.8 billion
ManagementCEO Bob Sasser (since 2004)
CFO Kevin Wampler (since 2008)
Return on Equity (average, past 3 years)30.1%
Cash/Debt$382.3 million / $265.5 million
Competitors

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 92% of the 488 members who have rated Dollar Tree believe the stock will outperform the S&P 500 going forward.   

Just last week, one of those bulls, kpoeppel, offered a balanced take on the Dollar Tree opportunity:

Proving to be profitable and growing. However, there's a lack of economic moat unless economies of scale can be achieved over other "dollar" stores. Very reasonable [price-to-earnings multiple] considering growth.

If you want market-thumping returns, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future. Of course, despite a strong four-star rating, Dollar Tree may not be your top choice.

We've found another retailer we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the newTrackPoisedToCAPS account.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 daysWe Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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