Dollarama Inc. - (DOL.TO) - May 3, 2024

At SIACharts, we compare head-to-head battles of thousands of stocks, commodities, mutual funds and exchange traded funds daily and rank them by who is winning the most in their respective universes. The top 25% are considered the Green Favored Zone, 26-50% make up the Yellow Neutral Zone and the bottom half of each league table is considered the Red Unfavored Zone.

The last time we looked at Dollarama Inc (DOL.TO) was in the September 18, 2023, edition of the Daily Stock Report. The shares first entered the Green Favored Zone of the SIA TSX Composite Index back on May 11th of last year at a price of $84.44. The shares have remained in the Favored Zone but did fall in the Neutral Zone earlier this spring but held onto its positive SMAX score ever since with the closing price of the shares now is at $115.27 representing at 36.5% price increase in less than 12 months time. Yesterday, DOL.TO finished in 43rd position, up 3 spots on the day and up 46 places in the last month. Over the last month, the shares are up 13.33%, compared with a decline of -1.14% for the TSX Composite Index. In looking at the attached three-year weekly Candlestick chart of Dollarama Inc, we see an ongoing uptrend which confirms the accumulation phase is firmly in place. Over this time, DOL.TO has steadily advanced in a step pattern of rallies followed by periods of consolidation at higher levels. Then in early April, Dollarama came out with its fourth quarter and fiscal year 2024 results reporting a comparable store sales growth of 8.7% for the quarter and 12.8% for the year along with an increase in their dividend of 29.9% which investors took kindly towards. As a result, the shares launched up by $10 per share signalling the accumulation phase has intensified with the stock currently making all time highs. With such a large move we could see the shares pause or consolidate somewhat as it has in the past and potentially resume its uptrend at higher highs. Only time will tell. Potential support on a pullback can be seen at the $105.00 area.

In the attached Point and Figure Chart at a 2% Scale, we see the share’s strong uptrend starting way back in January of 2022 with periods of strong rallies and then short periods of mild pullbacks and consolidations. The shares broke above the prior resistance level and psychological resistance at the $100.00 area back in February of this year and the rally has continued up until today. Based on measured moves the shares are at its near-term resistance level at $119.02. If it manages to break above this level, next resistance is at $134.04. To the downside, support can be found at its 3-box reversal of $107.80 and, below that, $99.59 which was the prior resistance. The shares currently exhibit a bullish Double Top pattern. With a bullish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of a perfect 10 out of 10, DOL.TO is exhibiting short-term strength against the asset classes.