Dollar stores carry a range of cheap household products and random merchandise that fit even the tightest family budgets. While inflation has pressured the “everything costs $1 or less” niche, the concept of everyday staples at bargain prices endures nonetheless.
Let's explore the three big dollar store stocks so you can decide if one may fit nicely within your investment portfolio.
| Name and ticker | Market cap | Dividend yield | Industry |
|---|---|---|---|
| Dollar General (NYSE:DG) | $22.8 billion | 2.28% | Food and Staples Retailing |
| Name and ticker | Market cap | Dividend yield | Industry |
|---|---|---|---|
| Dollar Tree (NASDAQ:DLTR) | $20.5 billion | 0.00% | Food and Staples Retailing |
| Name and ticker | Market cap | Dividend yield | Industry |
|---|---|---|---|
| Five Below (NASDAQ:FIVE) | $8.4 billion | 0.00% | Specialty Retail |
1. Dollar General
NYSE: DG
Key Data Points
2. Dollar Tree
NASDAQ: DLTR
Key Data Points
3. Five Below
NASDAQ: FIVE
Key Data Points
Five Below (FIVE +3.04%) opened its first store in 2002, which makes it a relative newcomer in the retail industry. The company targets young shoppers with an assortment of toys, party supplies, and other household basics -- many priced below $5.
Five Below trails its peers in store footprint and sales. The company has about 1,850 stores in the U.S., and generates about $3.9 billion in annual revenue.
Financial performance
Five Below has largely been a growth story since its 2012 initial public offering. Between fiscal years 2015 and 2019, the company delivered 20%-plus annual sales growth. By fiscal year 2024, the rate had leveled off somewhat to about 15%.
Five Below has the best operating margins of the three dollar stores, delivering more than 10% on this metric in most years, although the figure had sagged to around 8% by mid-2025. Profitability has been a little lumpy in recent years, with EPS declines in fiscal years 2021 and 2023; in addition, earnings were on a path to decline again during the first half of 2025.
Five Below's margins declined slightly in fiscal years 2023 and 2024 and were on course for another decline in 2025, but not to the extent of its two competitors.
Also, while Dollar General and Dollar Tree have similar, value-oriented forward P/E ratios, Five Below trades at a higher price point relative to earnings. No doubt investors appreciate the store's relative margin performance and consistency.
Stock price performance
Five Below stock has also seen better days. In early 2023, the stock traded for more than $200; by mid-2025, it had fallen to around $135.
Contributing to the decline was a cut to the sales outlook in mid-2024 and the departure of the company's CEO and president.
Dollar store competition
Dollar General, Dollar Tree, and Five Below compete most directly with each other, but there is fierce indirect competition in the broader shopping space. Big box stores like Walmart (WMT -0.46%), club stores Costco (COST -0.37%) and Sam's Club, and closeout retailers such as Big Lots all cater to value-oriented consumers.
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What to consider when investing in dollar store stocks
A lot of dollar store goods may be disposable and inexpensive, but that doesn't mean your investment should be the same. When investing in dollar store stocks, here are five things to think about:
Financial health. Look at variables like gross profit margins, operating margins, and net profit margins to see how efficiently the company is using its revenue. Make sure it's not overly leveraged with debt. Review any plans for share buybacks and dividends.
Competitive landscape. Not all dollar stores are created equal in the same areas. See if stores are concentrated in any one particular state or region, and compare it to potential competitors.
Economic factors. Dollar stores generally perform best during economic downturns. They can make money in good times, of course, but a buy-and-hold investor shouldn't assume that high profits posted during a recession will continue through good times.
Company factors. Is the company expanding, or is it closing stores, and why? Another key retail metric to consider is same-store sales. Review the company's annual report and keep tabs on top officers to make sure there's not excessive turnover in the C-suite.
Investment strategy. Make sure your investment aligns with your own personal goals and risk tolerance. As always, make sure you're buying a stock that will help you build wealth over the long term.
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