Better Buy: Costco vs. Dollar Tree

Despite their common designation as "discounters," Costco (NASDAQ: COST) and Dollar Tree (NASDAQ: DLTR) remain fundamentally different retail stocks. One tends to sell higher-scale items at heavily discounted prices to its members. The other emphasizes closeout items and ultra-low prices and no membership requirement.

These two stores have remained open throughout the pandemic. As providers of groceries, government authorities deemed both entities essential businesses. Nonetheless, both companies faced limitations and challenges as they coped with the harsh business conditions created by reaction to the coronavirus pandemic.

These problems have not affected the underlying stocks in the same way. Given their differences, investors should take a close look at both businesses and their financials to find which company is in a better position to deliver higher returns.

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Source Fool.com