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Dollar Tree stock dropped 3% in premarket trading after Goldman downgrading it to neutral and saying company’s improvements was priced in.

Shares of Dollar Tree are getting too expensive and investors should avoid making a big bet on the stock, according to Goldman Sachs.

Analyst Kate McShane downgraded the stock to neutral from buy, saying in a note to clients Monday night that the company’s comeback story is now priced in.

“We believe the stock now reflects the earnings uplift from the price increase at Dollar Tree as well as recent media reports around the potential for operational improvements, while incremental growth is likely limited due to an expected slowdown in discretionary spending by the low-end consumer and declining traffic,” McShane wrote.

“The higher $1.25 price point at legacy Dollar Tree stores could limit traffic improvement if the perceived relative value has diminished, discouraging that incremental stop in a trip,” the note said.

Even with the downgrade, Goldman raised its price target on the stock to $150 per share from $116. The new target is 6.1% above where the stock closed on Friday.

In addition,Dollar Tree, Inc. announced that it has priced a public offering of $1.2 billion of its senior notes, consisting of $800 million aggregate principal amount of its 2.650% Senior Notes due 2031 and $400 million aggregate principal amount of its 3.375% Senior Notes due 2051. The 2031 Notes and the 2051 Notes will bear interest at a rate of 2.650% and 3.375% per annum, respectively.

The Company expects to use the proceeds of the Offering to redeem its outstanding 3.700% Senior Notes due 2023 (the “Existing Notes”), with any remaining amounts to be used for general corporate purposes, which may include repurchases of the Company’s common stock. The Offering is expected to close onDecember 1, 2021, subject to customary closing conditions.