Key Highlights
- Dollarama shares climbed approximately 8% to CA$194.20 following first-quarter fiscal 2027 results that exceeded all projections
- Earnings increased 10.4% to C$302.3 million; per-share earnings of C$1.11 surpassed the C$0.99 analyst projection
- Revenue reached C$1.85 billion, representing a 21% annual increase and beating the C$1.82 billion expectation
- Canadian same-store sales climbed 5.6%, significantly outperforming the 3.7% projection
- Full-year fiscal 2027 outlook calls for 3–4% domestic comparable sales growth and 60–70 new Canadian locations
Shares of Dollarama (DOL) rallied approximately 8% to CA$194.20 on Thursday following the release of first-quarter fiscal 2027 financial results that exceeded analyst projections across all key performance indicators.
The Montreal-headquartered discount chain reported earnings of C$302.3 million, representing a 10.4% increase compared to the prior-year period. Per-share earnings on a diluted basis reached C$1.11, surpassing the Street consensus of C$0.99, according to data from S&P Capital IQ.
Revenue for the quarter that concluded on May 3 totaled C$1.85 billion — marking a 21% year-over-year jump and exceeding the C$1.82 billion analyst forecast.
EBITDA came in at C$582.5 million, representing a 17% annual increase and topping the C$535.6 million consensus estimate.
Comparable store sales in Canada rose 5.6% during the quarter, substantially exceeding the 3.7% growth rate that Wall Street had anticipated.
Aggressive Store Expansion Strategy Continues
Dollarama added 28 net new stores across Canada throughout the quarter, pushing its total domestic footprint to 1,719 locations as of the May 3 quarter end.
Chief Executive Neil Rossy noted that the company’s value-oriented positioning continues to attract consumers dealing with challenging economic conditions.
Persistent inflationary pressures combined with elevated fuel costs — partially attributed to geopolitical tensions in the Middle East — have driven price-conscious shoppers toward discount retail channels.
The retailer’s product assortment is predominantly priced between C$1 and C$5, a range that has proven effective in maintaining customer traffic levels.
Looking ahead to fiscal 2027, company leadership reiterated expectations for 3–4% growth in Canadian same-store sales alongside the addition of 60–70 net new domestic stores.
Global Footprint Expansion Progresses
Beyond its Canadian operations, Dollarama maintains international investments. The company holds an ownership position in Dollarcity, its Latin American entity, and completed the acquisition of The Reject Shop in Australia during the previous year.
TD Cowen analyst Brian Morrison highlighted that developments in Mexican and Australian markets demonstrate the scalability of the company’s business framework internationally, identifying these territories as potential drivers of substantial future expansion.
Analyst sentiment toward the stock has been predominantly positive leading up to this earnings release. Current Wall Street ratings include 11 buy recommendations, 4 hold ratings, and 1 sell rating.
Before Thursday’s session, RBC Capital maintained a price objective of C$225, CIBC established a target of C$212, TD Securities set their target at C$235, and Scotiabank positioned theirs at C$220 — all accompanied by favorable ratings.
Across the border, prominent U.S. retailers such as Walmart, Target, Dollar Tree, and Dollar General have recently signaled concerns about consumer spending patterns, which provides important context for understanding why Dollarama’s Canadian performance proved particularly noteworthy.
On an adjusted basis, the company’s per-share earnings for the period registered at C$1.05, compared to the C$0.99 Wall Street consensus.
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