2 Retail Stocks Seeing Influx of Calls Before Earnings

The fourth-quarter earnings season has mostly wrapped up, but a few stragglers are still slated to enter the confessional. Coming out before the open tomorrow and on Monday, respectively, are reports from Dollar General Corp (NYSE:DG) and Dollar Tree Inc (NASDAQ:DLTR). 

Trading down 1.1% at $144.45 this afternoon, DG is just off a multi-week low of $141.62, a pullback that maintained support at the $140 level. This area captured a similar pullback on Jan. 30, and now represents the bottom of a range that has been sticky for shares. Despite its inability to break above $160, the retail stock sports a 9% year-to-date gain.

Dollar Tree stock is trading 1.6% lower at $114.97, pulling back near the site of its early August peak, as well as the ascending 180-day moving average. DLTR now carries a 6% deficit for 2026,  and has backpedaled roughly 20% from its January annual high.

Following their last eight reports, DG and DLTR have moved higher five and three times, respectively. With the former averaging a move of 10.3% regardless of direction, traders expect a larger 12.1% move this time. The latter has seen an average 8.3% move in the past, with expectations for an increased 12.3% swing this time. 

Options traders lean bullish, per DG and DLTR's 50-day call/put volume ratios of 2.38 and 2.55, respectively, at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX). These rank in the 75th and 88th annual percentiles.

Short sellers have been building their positions, with short interest up 9.1% and 5.4% during the most recent respective reporting periods for both Dollar General and Dollar Tree stocks. This accounts for 3.5% of DG's and 6.2% of DLTR's total available floats.