Dollarama Inc. (DOL.TO)

This is a very well-run company. It is a strong defensive name--people will keep buying from this company when the economy goes down. However, it is trading at a very high valuation. Growth has justified that in the past. The company added credit cards a year ago and that increased the average sale considerably. It is also expanding online and owns a foreign company in a similar business. So there will be some growth but he is concerned that future growth will not keep up with the rise in the stock price, and that if there is a recession, the drop in value of this stock might be steeper than the growth in sales.

It is forming a nice base at $146 and would use this as his exit. It looks good fundamentally with a $10 profit target anticipated. Yield 0.3%. (Analysts’ price target is $165.69)

This is a growth story, not a defensive staple one (a struggling sector lately). But his concern about DOL it that it's trading at 28x earnings, so it's expensive. So, at the next misstep that happens to them, like an earnings miss, this stock will drop. It's well-managed and they haven't seriously missed an earnings in the past, though. It's come off its highs, getting way, way expensive and now only slightly expensive.

They said that they were going to do a 3-to-1 split, when is that happening? He doesn’t know. He thinks that might be good. Trading at 28 times forward earnings with 15% growth rate. He used to own it but sold it based on valuation. Some investors have concerns over competition coming over from the Asian market.

It has been up in 8 of the last 8 years. Defensive characteristics that you want to see during in the summer. Ideal entry point from a risk/reward perspective. Testing support.

This has been a darling for years and its stock price might have run its course. Its dividend is not that rich. After growth slows down, investors want to see the Board raise dividends. He always encourages people to take profits, and that applies here. Nothing goes up forever.

Great growth Canadian story. Seeing some more competition lately. Phenomenal company. Very well run. Still some growth runaway in Canada. It deserves the high multiple. (Analysts’ price target is $164.30)

He does own this and sees it as always expensive. He likes how hard they work for shareholder value. They survived the higher wage increase in Ontario. A core holding for sure.

The best retail stock in Canada. They don’t cease to amaze him. They will grow substantially this year. They are tremendous operators. He is excited by them having a 100 store franchise in Central America. They can buy a controlling interest in 2019. (Analysts’ target: $164.67).

The stock has done very well. He sees valuations stretched.

He does not think the recent trade dispute between the US and China will impact this company. The company reported great earnings last week. It is down of 52 week highs marginally and the pullback has been short and shallow. There are a lot of good things going on with room to go to 1700 across Canada – they are at 1460 now. Gross margins continue to increase. They are buying back about 5% of their shares each year. They are a little expensive at these levels, but he would buy on weakness.

This is in an uptrend. It corrected when the market was correcting. It was a little over bought. It is definitely in an uptrend.

Loves Dollarama. Terrific management, but an expensive stock. Only caveat: they have to continue to beat numbers. When they stop, then exit, but she doesn't expect this to happen. They've introduced credit cards and increased price points up to five dollars, which customers so far have accepted. And they're building stores. Growth will continue.

Bad weather has impacted their results in the past. He doesn’t own it now but has owned it in the past. The business is good but the stock is too expensive now. Their growth is tempering off a little bit from 25% to more like 15%. They tend to hold the line at 35% to 37% in term of growth margin and they get a lot of operating leverage. 29 times earnings is too much. At $130 he would be more interested.

Wish he had bought it. From a portfolio management standpoint, if you hold, say, 15% of this in your portfolio or you're worried about new minimum wage hikes, then sell it down so you can sleep at night. He holds 5% levels of each of his stocks, and loves the 7.5% level. 25 stocks in 10 sectors is a manageable portfolio.