Dollarama tops Wall Street estimates in the fiscal third quarter

Dollarama Inc. (TSE: DOL) said on Wednesday that its revenue came in better than expected in the fiscal third quarter as the COVID-19 crisis restricted people to their homes, fuelling demand for household essentials and Halloween decorations in recent months.

At £31 per share, Dollarama is currently 20% up year to date in the stock market after recovering from a low of £20.62 per share in March when the impact of the Coronavirus pandemic was at its peak. If you’re interested in the investing in the stock market, you’ll need a reliable broker – here’s a list of the top few to make selection easier for you.

Dollarama’s Q3 financial results versus analysts’ estimates

Dollarama said that it generated £620 million of net sales in the quarter that concluded on 1^st November. In the same quarter last year, its net sales were capped at a lower £551.11 million. According to Refinitiv, experts had forecast the company to print a slightly lower £578.62 million of net sales in the recent quarter.

Late last month, Dollarama’s U.S. competitor, Dollar Tree, also said that its net income climbed to £247.63 million in the fiscal third quarter.

The retail chain reported a 7.1% annualised growth in its Q3 same-store sales. Net earnings, it added, registered at £94.16 million in the third quarter that translates to 30.24 pence per share. In the comparable quarter of last year, Dollarama had posted a lower £80.61 million of net earnings or 25.59 pence per share.

Dollarama confirmed in the last week of November that one of its employees at its Newmarket location tested positive for COVID-19.

Dollarama declares 0.035 pence per share of cash dividend

At 44%, the Canadian company’s gross margin also saw a slight improvement from 43.7% last year. Dollarama said on Wednesday that it opened 19 net new stores in the recent quarter versus 21 that it opened in Q3 of fiscal 2020.

The board declared 0.035 pence of quarterly cash dividend per share on Wednesday that represents a 6.8% year over year increase. Dollarama refrained from giving guidance for the full year due to the ongoing COVID-19 uncertainties.

Dollarama performed largely upbeat in the stock market last year with an annual gain of roughly 40%. At the time of writing, it is valued at £9.66 billion and has a price to earnings ratio of 30.75.