BMO Capital analyst Tamy Chen maintained a Buy rating on Dollarama (DLMAF – Research Report) yesterday and set a price target of C$160.00.
Tamy Chen has given his Buy rating due to a combination of factors that highlight Dollarama’s strong market position and growth potential. Despite the stock’s valuation reaching historical highs, Chen believes that the current macroeconomic environment, characterized by rising cost inflation, benefits Dollarama’s business model as a price-follower and discount retailer. This positioning is expected to support the company’s valuation and growth trajectory.
Additionally, Chen anticipates consistent growth for Dollarama, with expectations of a 3% same-store sales increase and a continuation of the company’s growth algorithm into 2026. The forecast includes a modest expansion in gross margins and the opening of new stores in Canada. Furthermore, Dollarcity, a joint venture, is seen as an additional growth driver, despite some near-term challenges in its largest market, Colombia. Overall, Chen views Dollarama as a high-quality retailer with competitive advantages in the Canadian market.
In another report released on March 3, RBC Capital also reiterated a Buy rating on the stock with a C$159.00 price target.
Based on the recent corporate insider activity of 36 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of DLMAF in relation to earlier this year.