Dollar Tree joined main rival Dollar General in cutting annual forecasts after missing quarterly estimates on Wednesday as the discount store operator struggles to attract price-sensitive shoppers amid rising competition.

Shares of the company, which have lost nearly half of its value so far this year, were last down about 20% after touching an over four-year low of $64.04.

Bigger rivals, including Walmart and Target, as well as newer entrant, PDD Holding's ecommerce platform Temu, have been able to lure in shoppers with lower prices for everything ranging from groceries to apparel as consumers look for value.

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"While rising prices drove shoppers to low-cost retailers like Dollar Tree and Dollar General, that wave has crested and those merchants are now struggling to compete," eMarketer analyst Zak Stambor said.

Dollar Tree CFO Jeff Davis said that the annual forecast cut was partly due to expectations of conservative sales for the balance of the year.

"Customers are expanding their consumption (on low-margin essentials) while contracting their spending on discretionary items because of macro belt-tightening," said Davis on a post-earnings call.

Last week, rival Dollar General's shares also slumped nearly 30% as low-income households feel more pressure about spending on discretionary items.

Dollar Tree has been in the process of restructuring its business and in April said it was exploring options, including a potential sale or spinoff of its Family Dollar banner.

Earlier this year, it had outlined plans to shutter 970 Family Dollar stores. As of Aug. 3, Dollar Tree has shuttered about 655 stores and would close 45 stores through the remainder of the year, the company said on Wednesday.

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Chesapeake, Virginia-based Dollar Tree expects annual sales between $30.6 billion and $30.9 billion, compared with its prior forecast range of $31 billion to $32 billion.

The company sees annual adjusted earnings per share in the range of $5.20 to $5.60, compared with its prior forecast range of $6.50 to $7 per share.

Dollar Tree posted net sales of $7.37 billion, compared with analysts' estimates of $7.49 billion, according to LSEG data.