Dollarama (TSX:DOL) is a top Canadian-based retailer which operates more than 1,600 stores, helping consumers save money through its diverse, low-priced items. Last week, the company reported its latest quarterly numbers, for the third quarter, which went up until Oct. 27.
Revenue for the period totaled $1.6 billion, which rose by nearly 6% year over year. Comparable sales growth of 3.3% was also impressive, as this tells investors how much organic revenue growth it generated in stores which were open from a year ago. It’s an important metric because it shows whether the business is growing without factoring in the benefit of new store openings.
The company increased its targets for future growth, now planning to have 2,200 stores in Canada by 2034. Previously, it was expecting to have 2,000 locations by 2031. By expanding into new markets, that can help Dollarama reach more customers. The challenge, however, will be to do that without cannibalizing sales from existing stores and hindering their growth opportunities.
These recent results didn’t send Dollarama stock soaring but it’s still up around 50% since the start of the year. For years, it has been one of the best growth stocks on the TSX, and with the business still aiming for more growth in the future, it may not be too late to invest in the business. Although it isn’t a cheap buy, trading at more than 35 times its trailing earnings, for buy-and-hold investors, this can make for a solid stock to buy for the long haul.
