Dollarama (TSE:DOL) Issues Earnings Results

Dollarama (TSE:DOL) announced its quarterly earnings results on Wednesday. The company reported C$1.29 earnings per share (EPS) for the quarter, FiscalAI reports. Dollarama had a return on equity of 97.52% and a net margin of 17.32%.The firm had revenue of C$2.03 billion during the quarter.

Here are the key takeaways from Dollarama’s conference call:

• Strong second-quarter performance: Consolidated sales rose 17.6% to more than CAD 2 billion, EBITDA increased 11% to CAD 653 million, and diluted EPS grew 11.2% to CAD 1.29.
• Canadian momentum exceeded expectations, with same-store sales up 5.4% and traffic up 3.7%; Dollarama raised its fiscal 2027 same-store sales guidance to 4%-4.5% and its net-new-store outlook to 65-75 locations.
• Dollarcity continued to deliver strong growth, including a 30.3% increase in Dollarama’s share of net earnings, while Mexico’s network expanded to 21 stores and customer reception remained encouraging.
• Australia’s transformation remains a near-term drag, with the lower-priced merchandise transition expected to weigh more heavily on second-half sales and integration costs expected to increase; the segment recorded approximately CAD 25 million in losses at midyear.
• Higher oil prices, freight and supply-chain costs are expected to pressure Canadian margins from the third quarter onward, although management maintained its full-year gross-margin guidance of 45.0%-45.5% and said it would prioritize operational mitigation before pricing changes.

Dollarama Stock Down 1.0%

Shares of Dollarama stock opened at C$172.75 on Friday. Dollarama has a 1-year low of C$163.25 and a 1-year high of C$209.96. The company has a market capitalization of C$46.36 billion, a PE ratio of 35.55, a P/E/G ratio of 1.93 and a beta of 0.26. The company has a debt-to-equity ratio of 399.63, a current ratio of 1.55 and a quick ratio of 0.08. The business has a 50-day moving average of C$183.59 and a 200-day moving average of C$181.69.

Dollarama Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Friday, August 7th. Stockholders of record on Friday, August 7th were paid a dividend of $0.12 per share. The ex-dividend date was Friday, July 10th. This represents a $0.48 annualized dividend and a dividend yield of 0.3%. Dollarama’s dividend payout ratio (DPR) is currently 9.00%.

Wall Street Analyst Weigh In

Several equities research analysts have recently weighed in on DOL shares. Canadian Imperial Bank of Commerce upped their target price on Dollarama from C$202.00 to C$228.00 in a research report on Friday, June 12th. National Bank Financial raised their target price on Dollarama from C$209.00 to C$210.00 and gave the company an “outperform” rating in a report on Thursday. Royal Bank Of Canada boosted their price target on Dollarama from C$223.00 to C$225.00 and gave the stock an “outperform” rating in a research report on Thursday. Jefferies Financial Group upped their price target on Dollarama from C$200.00 to C$230.00 in a report on Friday, June 12th. Finally, BMO Capital Markets upped their price target on Dollarama from C$210.00 to C$221.00 in a report on Friday, June 12th. Ten equities research analysts have rated the stock with a Buy rating and one has assigned a Hold rating to the company. According to data from MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and a consensus target price of C$215.75.

Dollarama News Summary

Here are the key news stories impacting Dollarama this week:

• Positive Sentiment: Dollarama reported quarterly revenue of approximately C$2.03 billion, while EPS rose 11% to C$1.29. Sales increased 17.6% year over year, indicating continued consumer demand for discount merchandise as shoppers remain cautious. Dollarama: Q2 EPS up 11%
• Positive Sentiment: Management raised its fiscal 2027 sales-growth outlook for the Canadian business. The guidance increase suggests Dollarama expects trade-down behavior and inflation-related demand to continue benefiting its stores. Dollarama raises fiscal 2027 guidance after Q2 sales growth
• Positive Sentiment: Analysts remain broadly bullish. Desjardins and TD maintained “buy” ratings, while National Bank Financial and RBC maintained “outperform” ratings. Their price targets range from C$210 to C$225, implying substantial potential upside from the reported C$172.75 reference price, despite some target adjustments.

Dollarama Company Profile

Dollarama Inc is a Canada-based company principally engaged in operating discount retail stores. The company provides a broad range of everyday consumer products, general merchandise, and seasonal items, with merchandise at low fixed price points. General merchandise and consumer products jointly account for the majority of the company’s product offerings. The company’s stores are throughout Canada, generally located in convenient locations, such as metropolitan areas, midsize cities, and small towns.