Update: After A 16% Run, Dollarama Still Generating Dollars

Recently Dollarama, DOL or DLMAF.PK, has hit the lower range of my valuation target. On June 3rd 2013, I published a valuation report on DOL, Dollarama – A Stock That Generates Dollars. My research concluded that the implied intrinsic value of Dollarama is in the range of $6 to $6.6 billion, or $84.7 to $93.7 per share. As of September 30th 2013, DOL was trading at ~$84 with a market cap of $5.9 billion. I admit that the target price was hit much earlier than I anticipated. When I wrote the valuation report, DOL was trading at ~$72 a share and is now up 16% since. That’s pretty spectacular and blitz runs like that don’t come too often. Then again, if you read my research report, you would know that my assumptions were on the conservative side to minimize the downside risk. So I have tamed down management and analysts’ expectations.

Now that the stock is trading at record high, what should you do? Where do we go now? Should investors be buying more, trimming their position, something in the middle, or nothing? The point of the article is to provide an update on my valuation thesis. For the full valuation calculation report, I will refer you to the link above.


Click here for the rest of this article.


4 thoughts on “Update: After A 16% Run, Dollarama Still Generating Dollars

    1. Joe,
      C’est un peu coup de chance que j’ai atteint mon prix cible si rapidement. Mon metier n’est pas de faire des prédictions mais d’évaluer la valeur d’une compagnie en comparaison a son prix.

      1. Ouais je comprends reste que ton estimation de la valeur de la compagnie, ici Dollarama, comparativement à son prix est directement dans le mille ! Good Job man

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s