Thursday’s analyst upgrades and downgrades

Thursday’s analyst upgrades and downgrades DAVID LEEDER PUBLISHED YESTERDAY COMMENTS SHARE SAVE FOR LATER Listen to this article Learn more about audio Log in or create a free account to listen to this article. Inside the Market’s roundup of some of today’s key analyst actions Desjardins Securities analyst Chris Li thinks Dollarama Inc.’s (DOL-T +0.82% increase ) “solid” second-quarter fiscal 2027 results and raise to its full-year same-store sales growth guidance raise reflects “resilient demand, supported by DOL’s compelling value proposition, as verified by our latest pricing survey.” “SSSG momentum is continuing in 3Q. LATAM earnings growth remains strong (40 per cent),” he added. “We expect EPS and FCF growth to accelerate next year, driven by moderating losses in Australia, Mexico scaling and reaching EBITDA breakeven, potential launch of a $6 price point in Canada, and completion of the Western Canada logistics hub.” On Wednesday, shares of the Montreal-based discount retailer jumped 5.5 per cent after it quarterly earnings per share of $1.29, exceeding both Mr. Li’s $1.25 estimate and the consensus projection of $1.26. The beat was driven by domestic comparable store sales growth of 5.4 per cent, blowing past expectations (4.0 per cent and 4.3 per cent, respectively) alongside “strong” traffic growth of 3.7 per cent (versus Mr. Li’s 2.5-per-cent forecast), a slight sequential acceleration from 3.5 per cent in the last quarter." “This was driven by continued strong demand for both consumables and general merchandise, as consumers stay attracted to DOL’s value proposition at a time when there is continued pressure on household budgets,” he said in a client report. “Demand for seasonal (summer) products was slightly favourable vs a year ago, while toys continue to perform exceptionally well. “Given the 1H performance, the full-year comp guide was increased to 4.0–4.5 per cent from 3.0– 4.0 per cent. Economic conditions remain challenging given the ongoing trade war and elevated living costs, which prompted management to embed a prudent view for the balance of the year despite the solid 1H. This is in line with consensus of 4.4 per cent. We estimate the high end of its revised guidance implies 3.5 per cent in 2H vs 5.5 per cent in 1H, and that there appears to be some conservatism embedded in the guidance. Assuming a low-single-digit increase in average selling price and traffic remaining above 3 per cent, we estimate this could support SSSG…