A glance at the graph of today’s trading shows the Dow started out down but was modestly in positive territory much of the day before falling to a 0.6% loss at the close. The TSX started out in negative territory and then traded higher much of the day and finally closed unchanged from yesterday.
Canadian Tire was down 2.3% for no apparent reason.
Dollarama was out with very good earnings and rose 6.6% to $60.36. I will update the report on this company shortly. I thought it was over valued in January at $43.49. So I suspect my analysis will continue to suggest it is too pricey. I do however have a great deal of respect for it as a company and for its management. They are clearly doing very well indeed.
Dollarama now has an equity market value of $4.6 billion while Canadian Tire is at $5.5 billion. While Dollarama is very profitable and has established a lot of brand recognition and drawing power it’s really hard for me to believe it should be worth anything close to what Canadian Tire is. I will looking further into this comparison very shortly.