Dollarama Stock Hits All-Time Highs—Is It Still a Buy?

• Dollarama stock has surged nearly 300% in five years and now trades at all-time highs.
• The stock commands a premium valuation at 38 times trailing earnings but continues to expand aggressively.
• With new store openings planned and potential benefits from U.S. tariffs, the stock could have more room to run.

A High-Flying Stock With Strong Growth

Dollarama has been one of the best-performing stocks on the TSX, delivering nearly 300% returns over the past five years. Even with concerns about consumer spending, the discount retailer continues to thrive. In its last reported quarter (which ended on Oct. 27, 2024), comparable sales grew 3.3%, showing resilience despite economic uncertainty. The company is also expanding at a rapid pace, planning to open 60 to 70 net new stores in fiscal 2025.

A Premium Valuation—but Justified?

At 38 times trailing earnings, Dollarama is not a cheap stock, especially for a discount retailer. However, its consistent growth and market dominance justify its premium valuation. Investors looking ahead to the company’s next earnings report in April will be watching for updates on its expansion plans and how potential U.S. tariffs could impact Canadian retail spending. If tariffs encourage more domestic shopping, Dollarama could benefit from increased foot traffic and sales.

Is It Too Late to Buy?

Trading at all-time highs, Dollarama may seem expensive, but its track record suggests it can still deliver strong returns. For long-term investors willing to pay for quality growth, the stock remains a compelling option—especially as it continues expanding and solidifying its position in the Canadian retail market.