Key Highlights
- Dollarama shares climbed approximately 8% to CA$194.20 following better-than-expected Q1 fiscal 2027 performance
- Net income increased 10.4% to C$302.3 million; diluted earnings per share of C$1.11 exceeded consensus estimates of C$0.99
- Revenue reached C$1.85 billion, representing a 21% year-over-year increase and surpassing the C$1.82 billion projection
- Canadian same-store sales advanced 5.6%, significantly above the anticipated 3.7%
- Full-year fiscal 2027 outlook calls for 3–4% comparable sales growth in Canada and 60–70 net store additions
Dollarama (DOL) shares experienced a roughly 8% surge to CA$194.20 on Thursday following the release of first-quarter fiscal 2027 financial results that exceeded analyst projections across all significant categories.
The discount retailer reported net income of C$302.3 million, representing a 10.4% increase compared to the prior-year period. Diluted earnings per share of C$1.11 surpassed the Street consensus estimate of C$0.99, according to S&P Capital IQ data.
Revenue for the quarter that concluded on May 3 totaled C$1.85 billion — marking a 21% year-over-year gain and exceeding the anticipated C$1.82 billion.
EBITDA registered at C$582.5 million, climbing 17% from the previous year and beating the forecasted C$535.6 million.
Comparable store sales in Canada expanded by 5.6% during the period, substantially outperforming the 3.7% consensus projection from Wall Street analysts.
Robust Store Expansion Momentum
Dollarama added a net 28 new stores across Canada throughout the quarter, pushing its domestic location count to 1,719 as of May 3.
Chief Executive Officer Neil Rossy highlighted that the company’s value-oriented approach continues to connect with consumers facing challenging economic conditions.
Persistent inflationary pressures combined with elevated fuel costs — influenced in part by geopolitical tensions in the Middle East — have driven cost-conscious shoppers toward discount retail options.
The retailer prices the majority of its merchandise between C$1 and C$5, a range that has proven effective in maintaining consistent customer traffic.
Looking ahead to fiscal 2027, management reaffirmed expectations for 3–4% growth in Canadian comparable store sales along with 60–70 net new store openings domestically.
Global Footprint Expansion Progressing
Beyond its Canadian operations, Dollarama maintains international presence through its ownership position in Dollarcity, its Latin American division, and last year’s acquisition of Australia’s The Reject Shop.
TD Cowen analyst Brian Morrison noted that developments in Mexico and Australia validate the company’s business model internationally, identifying these markets as potential drivers of significant future growth.
Analyst sentiment remains predominantly positive heading into this earnings release, with current ratings showing 11 buy recommendations, 4 hold ratings, and 1 sell rating.
Before Thursday’s session, RBC Capital maintained a price target of C$225, CIBC projected C$212, TD Securities set a target of C$235, and Scotiabank established C$220 — all accompanied by favorable ratings.
Across the border, major U.S. retailers such as Walmart, Target, Dollar Tree, and Dollar General have recently highlighted consumer spending headwinds, which provides additional context for the strength of Dollarama’s domestic performance.
The company’s adjusted earnings per share for the quarter reached C$1.05, compared to the consensus estimate of C$0.99.
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