Now that Carl Icahn has taken a large stake in Family Dollar Stores Inc. (NYSE: FDO), 24/7 Wall St. wanted to see what sort of value this might imply for activist investors and value investors alike.

It turns out that none of the stocks are dirt cheap by any measure. Still, the growth in this segment remains a secular opportunity for investors who fancy themselves as part value investor and part growth investor.

We have included book value ratios here, although the first thing we would say is that book value in a retailer is something that may not be as relevant as other industries. It is the value of the total franchise that really matters here, and that is something that will vary greatly from buyer to buyer.

Included are forward price-to-earnings (P/E) ratios from next year using the Thomson Reuters consensus estimates. The prices are based on the closing bell prices on Friday and will be updated in the morning to reflect the prices on Monday after the levels settle down.

This is the valuation of the top dollar store and discount retail outfits that we follow. There are other companies with overlapping interests, but the idea is to try to keep things as close to an apples-to-apples analysis.

Where this gets interesting is that the dividends for the dollar stores and the discounters are just not impressive. Actually, that should be from not impressive to not paid at all.

Dollar General Corp. (NYSE: DG) has a price-to-book value of 3.64 to 1, and its market cap is almost $18 billion. Its forward P/E is about 14.3. Dollar General’s shares closed at $57.99, and the 52-week price range is $49.47 to $62.93. With a consensus target price of $63.89 from Thomson Reuters, Dollar General has an implied upside exceeding 10%. Dollar General pays no dividend, but that may change soon now that the private equity backers have sold out.

ALSO READ: America’s Most Popular Stores

Family Dollar Stores Inc. (NYSE: FDO) posts a 4.29-to-1 price-to-book value. Its market cap is $6.89 billion, and its forward P/E is less than 18. Family Dollar shares closed at $60.53, and the 52-week trading range is $55.64 to $75.29. With a consensus target price of $56.89, Family Dollar is now trading above its consensus price target by almost 6%. Family Dollar has a dividend yield north of 2%. For whatever this is worth, Family Dollar also just adopted a shareholder rights program. For those who are not familiar with proxy fights and activist investing, this is a poison pill trigger. Its intention is to dilute acquirers’ interests.

Dollar Tree Inc. (NASDAQ: DLTR) comes with an 8.65-to-1 price-to-book value ratio, making it the highest of the dollar stores in valuation. Its market cap is $11.4 billion, and its forward PE is less than 15.5. Dollar Tree shares closed at $55.14, and the 52-week trading range is $48.30 to $60.19. With a consensus target price of $61.79, Dollar Tree has an implied upside of 12%. The company offers no dividend to its investors.

There are also the discount stores. These offer overstock merchandise and clearance merchandise that is higher in price (and generally in quality) than the dollar store offerings. These companies do all compete for much of the same dollars spent by value seeking consumers who look to maximize their dollars spent.

Big Lots Inc. (NYSE: BIG) is valued at 2.98 times book value. This one is not quite full-blown retail and not quite a dollar store. Its market cap is $2.49 billion, and its forward P/E is less than 15. Big Lots recently closed at $43.67, and the 52-week trading range is $25.50 to $44.48. With a consensus target price of $48.00, Big Lots has an implied upside of 9.9%. No dividend is paid to its investors.

Tuesday Morning Corp. (NASDAQ: TUES) comes with a 3.83-to-1 price-to-book ratio. Its market cap of only $800 million makes it the smallest of the dollar stores and discounters we are featuring by far. Its forward P/E is over 40, but this was with a handful of analysts and after a 2014 turnaround. Tuesday Morning closed at $18.51 on Friday, and the 52-week trading range is $8.84 to $18.87. With a consensus target price of $19.67, Tuesday Morning has an implied upside of about 6%. Tuesday morning does not pay a dividend for its shareholders, not even on Tuesdays.

TJX Companies Inc. (NYSE: TJX) comes with a very high price-to-book ratio of 9.2, the highest among its peers. TJX also has the broadest scope of all discounters and a huge market cap of $39.51 billion. Its forward P/E is less than 16. TJX’s shares closed at $56.42, and the 52-week trading range is $48.71 to $64.38. With a consensus target price of $64.84, the discounter has an implied upside of 14.9%. TJX does pay a dividend for its common shareholders, although it is low at only 1.2%.

ALSO READ: Ten Strategies to Invest Like Warren Buffett

What exactly it is that Icahn sees is hard to really interpret. This sector has reached a high valuation already. The notion that these pulled back from highs is one thing that anyone could complain about, but this evolution from dollar stores into low-priced stores is not universally taking place without pain.

Again, the dividends here in dollar stores and discounters are just not very attractive. That being said, each segment has its own merits for part of a secular trend. It just so happens that this most recent recession and lower average wages in America have forced a larger number of American consumers into being sharply conscious of their retail and consumer spending. Every dollar counts.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.