Moody's ups Dollar Tree

Moody's Investors Service said it upgraded Dollar Tree, Inc.'s senior unsecured rating to Baa2 from Baa3. Moody's also upgraded the rating of Family Dollar Stores, Inc. legacy notes to Baa2 from Baa3 and changed the outlook for Dollar Tree and Family Dollar Stores to stable from positive.

“Dollar Tree has demonstrated continued strong operating performance and cash flow generation despite the headwinds caused by the coronavirus pandemic with double digit comparable store sales growth at its Family Dollar stores,” Moody's vice president Mickey Chadha stated in a news release.

“The upgrade reflects the consistent and sustained improvement in credit metrics through increased EBITDA generation and debt reduction and our expectation that metrics will remain strong with debt/EBITDA sustained below 3.0x.”

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