Dollarama, based in Montreal, rose 4.6 percent to C$67.59 at 11:30 a.m. in Toronto, the highest since its initial public offering in October 2009. Earlier it jumped as much as 4.1 percent. The shares have gained 9.6 percent in the year through yesterday for a market value of C$4.97 billion ($4.9 billion), compared with a 1 percent loss for the Standard & Poor’s TSX/Composite index.
“No other Canadian retailer offers similar consistent growth and visibility in the current challenging retail environment,” Irene Nattel, consumer analyst at RBC Capital Markets, a unit of Royal Bank of Canada, said in a note today. Nattel, who has C$76 price target on the stock, said she is confident the company can continue to deliver 15 percent to 25 percent organic earning-per-share growth.
The retailer, which operates 785 stores across Canada, reported adjusted fourth-quarter earnings of C$1.06 a share, compared with analysts’ average estimates of C$1.02 according to a survey of 10 analysts by Bloomberg. Sales in the quarter of C$561.9 million also topped estimates of C$550 million.
Dollarama raised its quarterly dividend 27 percent to 14 Canadian cents a share, from 11 cents, to be paid on May 7.
For fiscal 2013, Dollarama posted same-store sales growth of 6.5 percent, compared with 5.4 percent growth a year earlier.
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