On Friday, RBC (TSX:RY) Capital Markets adjusted its outlook on Dollarama Inc . (TSX:DOL:CN) (OTC: DLMAF) stock, raising the price target to Cdn$144.00 from the previous Cdn$138.00. The firm has reiterated its Outperform rating on the stock, signaling continued confidence in the company's performance.
The upgrade comes amid expectations that Dollarama is well-positioned to cater to consumers looking for value, especially as tighter budgets persist. The firm anticipates this trend to continue into 2025, influenced by factors such as the acceleration of mortgage resets.
RBC Capital Markets highlights Dollarama's growth prospects, citing clear visibility and sustainability. The company's growth is further supported by the potential expansion of Dollarcity, including plans to extend its reach into Mexico starting in 2026.
The firm also notes Dollarama's consistent return of capital to shareholders, emphasizing the company's practice of dividend growth and share repurchases. These factors contribute to Dollarama's attractiveness as an investment, according to RBC Capital Markets.
The price target adjustment to Cdn$144.00 represents a Cdn$6.00 increase and is based on a roll-forward to fiscal year 2027 estimates. This revised target reflects RBC Capital Markets' positive outlook on Dollarama's strategic positioning and financial prospects.
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