Around 40% of DLTR's supply is directly imported from foreign countries with the "Vast Majority" coming from China.
Dollar General has less than 10% in comparison
[DLTR & DG performance since Liberation day 2nd April](https://preview.redd.it/0sdupadzmlxe1.png?width=1181&format=png&auto=webp&s=8d4131d832e6101c185b077f2de09f342d6c7677)
The reason DG did quite well compared to DLTR at the initial announcement was because the difference in China supply exposure. It is quite straightforward --> DLTR has higher exposure to Chinese supply, DLTR will be worse off. Long DG and Short DLTR.
But now, that the prices have actually reached parity. I think the market is being too optimistic that this tariff situation is over.
If you have been reading the news, ever since 2nd April, trade between US and China effectively stopped. There is a month until the impact gets realised. I think you are going to see DLTR crash when management gives their earnings call guidance that they can't handle the inventory shock.
[https://finance.yahoo.com/news/dollar-tree-announces-chief-supply-120000161.html](https://finance.yahoo.com/news/dollar-tree-announces-chief-supply-120000161.html)
\^DLTR's Chief Supply Chain Officer just resigned today.
[https://www.youtube.com/watch?v=NbPvoxxsDbc](https://www.youtube.com/watch?v=NbPvoxxsDbc)
\^Impact of Trade War is delayed and has yet to hit consumers.
