Dollarama Inc. (DOL.TO)

Hasn't been adding due to valuation, and so it's one of his lowest-weight positions. Lots to like, but approaching saturation in Canada. Retail expanding internationally often doesn't work out. Latin American expansion is "so far, so good", but doesn't really move the needle (only 3-5% of profits).

Likes it long term. Expects a better buying opportunity.

Sideways and slightly downward lately. Still the dominant model in Canada. Higher energy and softness in Canadian economy are making consumers more value-focused. Expansion should help revenues and margins.

Main issue is valuation at 34x forward PE.

High multiple for growth, and growth didn't deliver what people were expecting. Canadian consumer feeling pinched. Market saturated in Canada, so they've gone international (and that makes him nervous).

Very high multiple of ~30x, yet growing ~13%. That troubles him. Sales miss, softer guidance, 4% EPS reduction, softer margins. Will probably do well in Mexico. Doesn't love it from risk/reward.

When times are tough, consumers gravitate to Walmart, Costco and Dollarama. DOL does a great job providing value to customers. He wishes he owned it. Problem is the high valuation, from high-30s to mid-30s, which remains too high.

Consumer’s hurting a bit at the lower end. Huge fan of this company. Classified as Consumer Discretionary, but it’s more a Consumer Staple. Performs well in both up and down business cycles. Choppy recently. Premium valuation, warranted. Core holding that helps stabilize your portfolio.

Whole witches' brew of things in the global economy that are impacting consumer spending. Higher interest rates, lack of rate cuts. Stock's still 33x PE. Higher valuation stocks tend to get hurt the most with interest rates rising.

On the other side of a phenomenal growth runway. Not opening as many stores, and those returns aren't as good. Mature company, growth hard to come by, so it's going international (less profitable). Don't buy the dip at this point.

It recently touched 40x PE, but has fallen to the mid-30s. Is a great business and likes it long term. He has scaled back his weighting over time because of valuation. Also, it is priced for perfection, so even good, but imperfect earnings impact the stock. He may add to it when its PE returns to the mid-20s.

Doing well, looking to build another 70-80 stores this year. Be cautious. Though defensive stocks tend to trade higher, PE ratio of 40x is double that of the TSX at 20x. In growth mode. Recessionary pressures in Canada would be a tailwind.

Great company, well run. Likes the business model -- hard to raise price by 10% on a $100 product, but much easier to do on a $1 product. Valuation is the concern; be aware that market sentiment could decide one day that it's not willing to pay 25x PE.

Pricey. Moving more up-market. How many more stores can they build? History of Canadian companies expanding in the US is not riddled with success. Be cautious.