TD Cowen analyst Brian Morrison maintained a Buy rating on Dollarama yesterday and set a price target of C$210.00.
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Brian Morrison’s rating is based on several key factors that highlight Dollarama’s potential for growth. He anticipates strong year-over-year earnings per share growth for Q3/F26, which is expected to support upward revisions to the company’s fiscal 2026 guidance. This growth is driven by solid sales performance, including a 4.4% increase in same-store sales, aided by additional Halloween selling days and strategic price increases.
Additionally, Dollarama’s expansion efforts in Latin America, particularly through Dollarcity, are expected to contribute significantly to equity growth, despite increased startup costs in Mexico. The company’s ability to maintain its value proposition and adapt its model in new markets like Mexico and Australia is seen as a factor that will sustain its premium valuation. While there is a note of caution regarding muted EPS growth in Q4/F26 due to timing and investment factors, the overall outlook remains positive, justifying the Buy rating.
Morrison covers the Consumer Cyclical sector, focusing on stocks such as Gildan Activewear, Aritzia, and Magna International. According to TipRanks, Morrison has an average return of 12.7% and a 57.88% success rate on recommended stocks.