UPDATE: Jefferies Raises PT to $88 on Dollar Tree

In a published note, Jefferies reiterates its Buy rating on Dollar Tree, Inc.

and raises its price target from $86 to $88 per share on expectations of a strong Q3. Jefferies says, “[I]nvestors should continue to own DLTR for its strong relative top-line growth, EBIT margin expansion, and its defensive profile. We have upped our Q3 estimate today and expect the company to be around the upper-end of plan. We believe another cycle of slower consumer spending is coming and Dollar Tree will be in the sweet spot, so we think the backdrop is favorable for this company. We upped our Q3 EPS estimate to $0.84 from $0.82. We flowed this through to our FY12 and FY13 EPS estimates also. This reflects a slightly higher comp store sales assumption at 4% in Q3 (up from 3%).” DLTR closed up 1.03 percent to $78.67 per share on Friday.