Dollarama Inc: National Bank Raises Target Forecast on Earnings Growth

Dollarama Inc. (DOL:CA) (DLMAF)

Dollarama Inc. (DOL:CA): National Bank has reiterated its “Outperform” rating on Dollarama, while raising its target price to $213 from $207 as of August 19, 2025. The upward revision reflects confidence in Dollarama’s ability to deliver continued earnings growth, supported by its resilient discount retail model, steady same-store sales growth, and the company’s effective pricing and product mix strategy. Analysts at National Bank highlighted that Dollarama continues to benefit from strong consumer demand for value-oriented products in an environment where households remain pressured by inflation and elevated interest rates.

The brokerage also noted that Dollarama’s expansion strategy, including the opening of new stores across Canada and the scaling of its international operations through Dollarcity in Latin America, provides a long runway for growth. Margin performance remains a key strength, with cost efficiencies and scale advantages helping offset currency and input cost pressures. The raised target reflects National Bank’s view that Dollarama is well-positioned to maintain its leadership in the Canadian discount retail space and continue delivering double-digit earnings growth in the near to medium term.

Stock Forecast & Analysis

The consensus analyst rating on Dollarama Inc. (DOL:CA) is a “Buy”. On average, analysts assign a 12-month price target of $197 per share, suggesting the stock is at fair value from current trading levels. The consensus outlook is underpinned by Dollarama’s ability to deliver steady sales growth, particularly through strong same-store sales performance and an expanding store footprint across Canada.

Analysts also point to the company’s value-focused merchandise mix as a competitive advantage in an environment where consumers are increasingly price-sensitive due to persistent inflation and high borrowing costs. Beyond domestic growth, Dollarama’s international exposure through its stake in Dollarcity continues to gain traction, providing additional revenue diversification and expansion opportunities across Latin America.

The consensus “Buy” rating highlights confidence that Dollarama can maintain its strong operating margins, leverage its supply chain efficiencies, and continue to reward shareholders through earnings growth and capital returns.

STA Research

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