# Dollarama (DOL)

Sector: Discount variety retail

| Field | Value |
|---|---|
| Price | CA$218.47 |
| Market cap | CA$59B |
| Intrinsic value source | Analysts |
| Data as of | 2026-11-12 |
| Next earnings | 2026-12-10 (confirmed) |

Analysts: Bullish

Picks: Research only

Discount category: Far above intrinsic value

## In short

Dollarama trades above its intrinsic value because investors pay for its steady Canadian growth and Dollarcity profit, and only growth that lasts while Australia and Mexico stop losing money can support this price.

## Themes and gap

- Themes: Weak consumer (weak-consumer), Tariffs and trade (trade-tariffs)
- Gap type: Slow (slow)
- Why: Only several years of store openings, Canadian comparable sales growth and a move to profit in Australia and Mexico can lift earnings toward the price.

## About

Dollarama Inc. (Dollarama) is a Canadian value retailer based in Montreal. It sells consumables, general merchandise and seasonal goods at low fixed price points. It had 1,734 stores in Canada at August 2, 2026. In July 2025, it bought The Reject Shop, now Dollarama Australia, which had 414 stores in Australia at August 2, 2026. Dollarama also owns 60.1% of Central American Retail Sourcing (CARS) and 80.05% of Inversiones Comerciales Mexicanas (ICM). They run Dollarcity, a value retailer with 781 stores in Colombia, Guatemala, Peru, El Salvador and Mexico at June 30, 2026. Dollarama counts its stakes in Dollarcity as joint arrangements and reports their earnings on one line. It reports Canadian and Australian segments. Sales were $2,026.6 million in the second quarter of fiscal 2027, which ended on August 2, 2026. Neil Rossy is President and Chief Executive Officer. The shares trade on the Toronto Stock Exchange in Canadian dollars. Dollarama is not a US SEC filer, so this profile comes from its own reports.

## Thesis

Dollarama trades above its intrinsic value because investors pay a high price for its steady growth. Canadian comparable store sales rose 5.4% in the second quarter of fiscal 2027, the company plans 65 to 75 net new stores in Canada, and the Dollarcity stake adds profit. Two things hold back earnings per share. Australia loses money while stores change to the Dollarama layout, and Dollarama expects a net loss there in fiscal 2027, which cost $0.05 per share in Q2. Mexico also loses money while it grows. The consolidated EBITDA margin fell to 32.2% from 34.1% mostly because of Australia, while the Canadian margin rose to 34.9%. For this price to hold, three things must be true. Canadian comparable sales must keep growing at the guided 4.0% to 4.5%, with a gross margin of 45.0% to 45.5%. Australia must move toward profit after the store conversions, of which 60 of 414 are done. Dollarcity must keep growing its earnings while Mexico expands. The Q3 report on December 10, 2026 and the Q4 report in March 2027 are the next tests.

## Checkpoints

- Sep 16, 2026: Q2 fiscal 2027 results: Canadian comparable sales. Status: Passed. Watch: Canadian comparable store sales growth of 4.0% or more passes; growth below 3.0% fails. Outcome: Canadian comparable store sales rose 5.4%, and Dollarama raised its fiscal 2027 range to 4.0% to 4.5%.
- Dec 10, 2026: Q3 fiscal 2027 results: comparable sales and Australia. Status: Pending. Watch: Canadian comparable store sales growth of 4.0% or more with an Australian drag of $0.05 per share or less passes; slower sales or a larger drag fails.
- Mar 2027 (estimate): Q4 fiscal 2027 results: fiscal 2028 guidance. Status: Pending. Watch: Fiscal 2028 guidance for 60 or more net new stores in Canada and comparable store sales growth of 3% or more passes; weaker guidance fails.

## Balance sheet

Dollarama reported cash of C$479.7 million and total debt of C$2,996.7 million at August 2, 2026, so net debt was C$2,517.0 million (C$2,293.6 million at February 1, 2026). The debt is mostly senior unsecured fixed rate notes: C$375 million at 4.576% due April 2036, C$375 million at 3.940% due July 2031, C$600 million at 3.850% due December 2030, C$450 million at 5.165% due April 2030, C$375 million at 2.443% due July 2029, C$500 million at 5.533% due September 2028 and C$300 million at 1.505% due September 2027. Inventories were C$1,096.1 million and total assets were C$8,180.3 million. Shareholders' equity was C$1,477.9 million, kept low by buybacks. Dollarama bought back C$300.4 million of shares in Q2.

As of 2026-08-02.

Sources:

- https://www.dollarama.com/en-CA/corp/wp-content/uploads/2026/09/Q2FY27-DOL-PR-ENG-website.pdf
- https://www.dollarama.com/en-CA/corp/wp-content/uploads/2026/09/Q2FY27-DOL-MDA-ENG-website.pdf

## Dividends

- Dividend yield: 0.2% (last 12 months, at the current price)
- Paid per share, last 12 months: CA$0.466 (4 payments)
- Current annual rate: CA$0.48 (CA$0.12 x 4 a year)
- Latest ex-dividend date: 2026-10-09, CA$0.12 per share
- Growth from 2020 to 2025: 18.4% a year
- Growth from 2015 to 2025: 13.4% a year

Dividends per share by year: 2016: CA$0.13, 2017: CA$0.1433, 2018: CA$0.1567, 2019: CA$0.172, 2020: CA$0.176, 2021: CA$0.197, 2022: CA$0.215, 2023: CA$0.268, 2024: CA$0.347, 2025: CA$0.41.

Source: company filings and market data, read on 2026-11-13.

## Recent events

- 2026-11-09: Dollarama said that it will report third quarter fiscal 2027 results on Thursday, December 10, 2026, before the market opens, and that management will hold a call the same day.
- 2026-09-16: Dollarama reported second quarter fiscal 2027 results. Sales were $2,026.6 million, up 17.6%, diluted EPS was $1.29 against $1.16 and EBITDA was $653.0 million. It raised its Canadian fiscal 2027 guidance to 65 to 75 net new stores and comparable store sales growth of 4.0% to 4.5%. The board declared a quarterly dividend of $0.12 per share.
- 2026-08-19: The board of CARS approved a cash dividend of US$125.0 million. Dollarama's share was US$75.1 million (C$103.8 million), received in the third quarter. Dollarama used part of it for a capital contribution of US$38.0 million (C$52.4 million) to ICM for expansion in Mexico.
- 2026-07-08: The 1.871% fixed rate notes of C$375 million matured. Dollarama had issued 3.940% notes due 2031 and 4.576% notes due 2036, C$375 million each, in the first quarter of fiscal 2027 to repay them and to fund capital spending.
- 2026-07-03: Dollarama renewed its normal course issuer bid for up to 13,532,086 shares, 5.0% of its shares, from July 7, 2026 to July 6, 2027. In the second quarter it bought back 1,596,016 shares for C$300.4 million, an average of C$188.23 per share.
- 2026-03-24: Dollarama gave its fiscal 2027 guidance for Canada: 60 to 70 net new stores, comparable store sales growth of 3.0% to 4.0%, a gross margin of 45.0% to 45.5%, SG&A of 14.1% to 14.6% of sales and capital spending of C$420 million to C$470 million. It expected a net loss for Australia.

## Risks

- Medium: Australia may take longer to reach profit. Its gross margin and SG&A are weaker than those in Canada, and Dollarama expects a net loss there for fiscal 2027. The conversion of 414 stores will take several years, and all stores keep the old banner until the products match.
- Medium: Dollarcity is a large share of profit. Dollarama's share of its net earnings was C$49.9 million in Q2, about 14% of net earnings. The stores are in Colombia, Guatemala, Peru, El Salvador and Mexico, so currency, politics and the Mexico expansion can change the result.
- Medium: Import costs depend on the exchange rate. Dollarama buys most goods in US dollars and uses forward contracts to hedge most of its forecast purchases. A weaker Canadian dollar or new tariffs would raise costs after the hedges end.
- Medium: Growth must continue in Canada. Guidance asks for 65 to 75 net new stores and comparable sales growth of 4.0% to 4.5%. Slower openings, fewer shoppers or more competition would cut growth that the share price already expects.
- Low: Debt and leases add fixed costs. Net debt was C$2,517.0 million at August 2, 2026, and lease right-of-use assets were C$2,516.9 million. Net financing costs were C$51.2 million in Q2, up from C$43.2 million.

## Links

- Page: https://picks.utilarium.app/company/DOL/
- History of changes: https://picks.utilarium.app/company/DOL/history/
- JSON with full history: https://picks.utilarium.app/data/company/DOL.json

> Picks is a personal record of stock picks. It gives general opinions about stocks, including a "Top pick" label. They are not tailored to your needs, goals or risk tolerance. Kevin is not a registered adviser and relies on the general-advice exemption in Canadian securities law (NI 31-103 s.8.25). Do your own research, or ask a registered adviser. Kevin may hold any stock on this site. Prices, intrinsic values and ratings can be delayed or wrong; check the original source. Full disclaimer: /disclaimer/.