“Cheap and cheerful” is the name of the game when it comes to shopping for a Valentine’s Day gift.
After all, if you have real true love, that’s ultimately more meaningful than some of the expensive jewelry you might find at one at your local Signet Jewelers Ltd. or Hudson’s Bay Co.
But let’s not get carried away here. I’m not suggesting that you go out and get your beloved romantic partner one of the many tchotchkes available at under $4 from any of the 1,000 Dollarama Inc. (TSX:DOL) locations across Canada.
You could do that — and you might want to think about pairing it with a thoughtful greeting card from Shoppers Drug Mart, a wholly owned subsidiary of Loblaw Companies Ltd., and even add a small bouquet of flowers that are available near the entrance of your local Metro, Inc.
The gift that keeps on giving
If you really want to impress that special someone in your life, you might want to consider buying them a share or two in Dollarama stock. It is literally the gift that keeps on giving.
And I mean that sincerely.
Dollarama’s stock has risen by an incredible 1,620% percent since the start of 2010. That works out to a 42% return in your portfolio, annually. Who wouldn’t love that?
And the really beautiful thing about Dollarama shares is that management and the board of directors have been growing the company’s dividend payout at a similar clip. Dollarama initiated its dividend at $0.09 back in 2011, and since then it has managed to increase that payout by on average 30.2% per year.
Taking the capital gains and dividend returns in combination, owning Dollarama shares over the past eight years has been the virtual equivalent to owning a printing press.
And while many brick-and-mortar retailers have found themselves in contraction mode over the past year, Dollarama has been busy adding to its physical footprint. The company added 40 net new stores over the first nine months of 2017 with plans to add a total of 60-70 new stores by the end of the fiscal year. That’s 6% more selling space being added each year the company can operate from.
Even more impressive is that as the company continues to add locations, they haven’t been eating into the existing business. Far from it. As sales at comparable stores have been up 5.1% so far in 2017 compared to the year prior, helping to contribute to very respectable 25.9% earnings growth over the first nine months of 2017.
Conclusion
The perfect gift to give your loved one on Valentine’s Day is something they will be able to remember you by — something they will be able to grow with, and something that will have real value to them.
Ladies and gentlemen, I give you Dollarama.
