DOLLARAMA INC (DOL.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:DOL - CA25675T1075 - Common Stock
192.22 CAD
-0.76 (-0.39%)
Taking everything into account, DOL scores 6 out of 10 in our fundamental rating. DOL was compared to 3 industry peers in the Broadline Retail industry. While DOL has a great profitability rating, there are some minor concerns on its financial health. DOL is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- DOL had positive earnings in the past year.
- In the past year DOL had a positive cash flow from operations.
- In the past 5 years DOL has always been profitable.
- In the past 5 years DOL always reported a positive cash flow from operatings.
1.2 Ratios
- With an excellent Return On Assets value of 17.67%, DOL belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- DOL has a Return On Equity of 100.76%. This is amongst the best in the industry. DOL outperforms 100.00% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 21.54%, DOL belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
- The Average Return On Invested Capital over the past 3 years for DOL is significantly above the industry average of 11.07%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.67% | ||
| ROE | 100.76% | ||
| ROIC | 21.54% |
ROA(3y)17.95%
ROA(5y)16.71%
ROE(3y)1062.04%
ROE(5y)N/A
ROIC(3y)22.87%
ROIC(5y)23.07%
1.3 Margins
- DOL's Profit Margin of 18.59% is amongst the best of the industry. DOL outperforms 100.00% of its industry peers.
- DOL's Profit Margin has improved in the last couple of years.
- With an excellent Operating Margin value of 24.63%, DOL belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
- In the last couple of years the Operating Margin of DOL has grown nicely.
- DOL has a better Gross Margin (45.38%) than 100.00% of its industry peers.
- In the last couple of years the Gross Margin of DOL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.63% | ||
| PM (TTM) | 18.59% | ||
| GM | 45.38% |
OM growth 3Y3.75%
OM growth 5Y1.7%
PM growth 3Y5.97%
PM growth 5Y4.12%
GM growth 3Y0.9%
GM growth 5Y0.68%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), DOL is creating value.
- The number of shares outstanding for DOL has been reduced compared to 1 year ago.
- The number of shares outstanding for DOL has been reduced compared to 5 years ago.
- The debt/assets ratio for DOL has been reduced compared to a year ago.
2.2 Solvency
- DOL has an Altman-Z score of 6.91. This indicates that DOL is financially healthy and has little risk of bankruptcy at the moment.
- The Altman-Z score of DOL (6.91) is better than 100.00% of its industry peers.
- The Debt to FCF ratio of DOL is 3.65, which is a good value as it means it would take DOL, 3.65 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 3.65, DOL belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
- A Debt/Equity ratio of 3.56 is on the high side and indicates that DOL has dependencies on debt financing.
- With a Debt to Equity ratio value of 3.56, DOL is not doing good in the industry: 66.67% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.56 | ||
| Debt/FCF | 3.65 | ||
| Altman-Z | 6.91 |
ROIC/WACC2.71
WACC7.95%
2.3 Liquidity
- DOL has a Current Ratio of 1.09. This is a normal value and indicates that DOL is financially healthy and should not expect problems in meeting its short term obligations.
- DOL has a Current ratio of 1.09. This is in the lower half of the industry: DOL underperforms 66.67% of its industry peers.
- A Quick Ratio of 0.23 indicates that DOL may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.23, DOL is doing worse than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.23 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 19.39% over the past year.
- Measured over the past years, DOL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.83% on average per year.
- The Revenue has grown by 14.02% in the past year. This is quite good.
- DOL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 11.11% yearly.
EPS 1Y (TTM)19.39%
EPS 3Y23.76%
EPS 5Y18.83%
EPS Q2Q%19.39%
Revenue 1Y (TTM)14.02%
Revenue growth 3Y13.98%
Revenue growth 5Y11.11%
Sales Q2Q%22.19%
3.2 Future
- Based on estimates for the next years, DOL will show a quite strong growth in Earnings Per Share. The EPS will grow by 15.26% on average per year.
- The Revenue is expected to grow by 9.00% on average over the next years. This is quite good.
EPS Next Y13.27%
EPS Next 2Y12.96%
EPS Next 3Y12.92%
EPS Next 5Y15.26%
Revenue Next Year13.1%
Revenue Next 2Y12.53%
Revenue Next 3Y10.59%
Revenue Next 5Y9%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 41.07, DOL can be considered very expensive at the moment.
- DOL's Price/Earnings ratio is a bit more expensive when compared to the industry. DOL is more expensive than 66.67% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 27.21. DOL is valued rather expensively when compared to this.
- DOL is valuated quite expensively with a Price/Forward Earnings ratio of 36.12.
- 66.67% of the companies in the same industry are cheaper than DOL, based on the Price/Forward Earnings ratio.
- When comparing the Price/Forward Earnings ratio of DOL to the average of the S&P500 Index (25.98), we can say DOL is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.07 | ||
| Fwd PE | 36.12 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DOL indicates a slightly more expensive valuation: DOL is more expensive than 66.67% of the companies listed in the same industry.
- DOL's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. DOL is more expensive than 66.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.68 | ||
| EV/EBITDA | 26.54 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates DOL does not grow enough to justify the current Price/Earnings ratio.
- DOL has an outstanding profitability rating, which may justify a higher PE ratio.
- DOL's earnings are expected to grow with 12.92% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.09
PEG (5Y)2.18
EPS Next 2Y12.96%
EPS Next 3Y12.92%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.22%, DOL is not a good candidate for dividend investing.
- DOL's Dividend Yield is slightly below the industry average, which is at 2.81.
- Compared to an average S&P500 Dividend Yield of 1.81, DOL's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.22% |
5.2 History
- The dividend of DOL is nicely growing with an annual growth rate of 15.08%!
- DOL has been paying a dividend for at least 10 years, so it has a reliable track record.
- DOL has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)15.08%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
- DOL pays out 8.41% of its income as dividend. This is a sustainable payout ratio.
- DOL's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP8.41%
EPS Next 2Y12.96%
EPS Next 3Y12.92%
DOLLARAMA INC / DOL.CA FAQ
Can you provide the ChartMill fundamental rating for DOLLARAMA INC?
ChartMill assigns a fundamental rating of 6 / 10 to DOL.CA.
What is the valuation status of DOLLARAMA INC (DOL.CA) stock?
ChartMill assigns a valuation rating of 1 / 10 to DOLLARAMA INC (DOL.CA). This can be considered as Overvalued.
How profitable is DOLLARAMA INC (DOL.CA) stock?
DOLLARAMA INC (DOL.CA) has a profitability rating of 9 / 10.
What is the valuation of DOLLARAMA INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for DOLLARAMA INC (DOL.CA) is 41.07 and the Price/Book (PB) ratio is 40.54.
Can you provide the financial health for DOL stock?
The financial health rating of DOLLARAMA INC (DOL.CA) is 6 / 10.