Benzinga | Mar 2, 2021 06:25PM EST

Here's How Much Investing $1,000 In Dollar Tree Stock 5 Years Ago Would Be Worth Today

Investors who have owned stocks since 2016 generally have experienced some big gains. In fact, the SPDR S&P 500 (NYSE:SPY) total return in the past five years is 116.7%. But there is no question some big-name stocks performed better than others along the way.

Dollar Tree's Difficult Run: One company that has been a lackluster investment in the past five years is dollar store giant Dollar Tree, Inc. (NYSE:DLTR).

While dollar store competitors Dollar General Corp. (NYSE:DG) and Five Below Inc (NASDAQ:FIVE) have thrived in the Amazon.com, Inc (NASDAQ:AMZN) era, Dollar Tree shares have significantly lagged the overall market in recent years.

From 2010 to 2019, Dollar Tree underwent a rapid period of expansion, growing its store footprint from around 4,000 locations to more than 16,000 stores in 44 different U.S. states. Part of that significant growth included an $8.5 billion buyout of Family Dollar back in 2015.

However, Dollar Tree announced in 2019 it was closing up to 390 Family Dollar stores and renovate another 1,000 stores as part of a strategic repositioning plan.

At the beginning of 2016, Dollar Tree shares were trading at around $77. By mid-2016, Dollar Tree shares got so close to $100 investors could taste it, but the stock peaked at $99.83 before pulling back. The stock eventually found support at $65.65 in mid-2017 before going on another big run.

Dollar Tree made it up to $116.65 in early 2018 before dropping back to $78.78 late in the year.

Dollar Tree made it as high as $119.71 in late 2019 prior to the 2020 pandemic.

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Dollar Tree In 2021, Beyond: Fortunately for Dollar Tree investors, the dollar store business held up relatively well throughout the 2020 health crisis. Dollar Tree shares hit their low point of the past five years during the March market sell-off, initially dropping as low as $60.20 before bouncing back. Unfortunately, the stock lagged other discount retailers since the pandemic lows even after reporting 29% EPS growth in the third quarter and telling investors the holiday shopping season was off to a "very good start."

Dollar Tree shares made it as high as $115.45 in early 2021 before pulling back to around $97.

Despite the stock's struggles, Dollar Tree investors who bought five years ago and held on have still generated positive returns during one of the hottest market periods in recent history. In fact, $1,000 in Dollar Tree stock bought in 2016 would be worth about $1,209 today, assuming reinvested dividends.

Looking ahead, analysts are expecting Dollar Tree to come back to life in the next 12 months. The average price Dollar Tree among the 24 analysts covering the stock is $125, suggesting 28.5% upside from current levels.

Photo by M.O. Stevens/Wikimedia.