On Friday the S&P 500 fell 0.4% and Toronto was about unchanged. U.S. markets have fallen moderately due to concerns that the Congress will fail to pass a budget bill by Monday which would force a shutdown of many government departments. There is a also a looming debt ceiling that needs to be lifted. This all appears to be politics and theatrics and is likely to get resolved. Those positioned with some cash to spend on dips may find some bargains.
Dollarama is updated but rated only Weak Buy at $84.30. This is a great company. One of the best managed companies that I know of. But is simply seems to be too expensive. Admittedly I though the same when I added to this site in early 2012 at $43.49. So, I guess I missed this one. But the reality is that I have a system that seems to work well for me. My system is more likely to identify more obvious bargains than Dollarama. My system tends to assume that a company growing at 30% will not keep doing that. When a company does keep growing earnings per share at 30% it may well be that I will not have bought that company or rated it a Buy. (Though I did rate Dollarama a (lower) Buy in December 2012 at $58). I don’t worry much about the stocks I miss out on. There are always hundreds of stocks rising in price. We can’t own them all or hope to identify them all or anything close to that. My goal is that the stocks I do own or do rate as Buys rise acceptably in value. If that happens on average, we will do okay.
In any case I like keeping an eye on Dollarama since it helps me understand what kinds of things can lead to excellent profitability in a retail operation.