What Happened?
A number of stocks fell in the afternoon session after a significant downward revision of U.S. job creation data raised concerns about the health of the economy.
The Labor Department reported that employers added 911,000 fewer jobs from April 2024 through March 2025 than initially estimated. This revision brings the average monthly job gains during that period down significantly, suggesting a cooler labor market. The downgrades were widespread across various service sectors. The largest revisions were seen in leisure and hospitality, which added 176,000 fewer jobs than first reported, followed by professional and business services and retail. Such data is closely watched by investors and economists as it can influence the Federal Reserve's decisions on interest rates.
JPMorgan Chase CEO Jamie Dimon added that the U.S. economy is "weakening," though he stopped short of predicting a recession. "Whether it's on the way to recession or just weakening, I don't know," he said. Dimon's remarks are closely watched, given his influence as head of one of the nation's largest banks.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Specialty Retail company Petco (NASDAQ: WOOF) fell 3%. Is now the time to buy Petco? Access our full analysis report here, it’s free.
- Discount Grocery Store company Dollar Tree (NASDAQ: DLTR) fell 3.6%. Is now the time to buy Dollar Tree? Access our full analysis report here, it’s free.
- Apparel Retailer company American Eagle (NYSE: AEO) fell 3.4%. Is now the time to buy American Eagle? Access our full analysis report here, it’s free.
- Grocery Store company Grocery Outlet (NASDAQ: GO) fell 2.5%. Is now the time to buy Grocery Outlet? Access our full analysis report here, it’s free.
- Discount Grocery Store company Dollar General (NYSE: DG) fell 3.3%. Is now the time to buy Dollar General? Access our full analysis report here, it’s free.
Zooming In On Dollar Tree (DLTR)
Dollar Tree’s shares are quite volatile and have had 16 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock dropped 3.8% on the news that Guggenheim lowered its price target on the stock, citing concerns over tariffs. The investment firm reduced its target to $125 from $130 but maintained its Buy rating on the discount retailer. Guggenheim noted that volatility in the company's performance is "largely tariff-related," impacting costs and expenses. This follows a period where the stock has underperformed the S&P 500 by about 13%, which the firm attributed to softer comparable sales and weaker-than-expected third-quarter earnings guidance. Adding to the cautious sentiment, Piper Sandler also lowered its price target for Dollar Tree to $108, while maintaining a Neutral rating on the shares.
Dollar Tree is up 25.3% since the beginning of the year, but at $95.86 per share, it is still trading 18.2% below its 52-week high of $117.16 from August 2025. Investors who bought $1,000 worth of Dollar Tree’s shares 5 years ago would now be looking at an investment worth $1,044.
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