Resilient Consumer Demand Supports Steady Earnings – DOL & MRU

Section 1: Introduction

Inflation Report Coverage:

• Inflation report highlights how inflation impacts sectors differently, favoring value and defensive sectors like Energy, Materials, Consumer Staples, Healthcare, Utilities, select Financials, and REITs with inflation-indexed leases, while rate-sensitive sectors like Consumer Discretionary and high-growth Tech typically underperform.
• The report focuses on companies with proven business models, steady financials, high free cash flow, and solid ROE that can pass on costs to customers and protect margins. The aim is to identify stocks that can outperform inflation via capital gains and dividends, supporting diversified sectoral exposure.

Stocks Covered:

• Dollarama Inc. (TSX: DOL) delivered decent Q3 2026 results with sales up 22.2% and net earnings rising 16.6%, driven by 6.0% Canadian same-store sales growth and continued store expansion. Resilient margins, disciplined cost control, and strength in consumables and seasonal categories supported performance. Ongoing buybacks, dividend growth, and international expansion through Dollarcity position the company for steady long-term value creation.
• METRO INC. (TSX: MRU) delivered resilient Q1 2026 results with sales up 3.3%, supported by steady food and pharmacy same-store sales despite calendar headwinds and a temporary supply chain disruption. Adjusted earnings grew year over year, reflecting stable margins, disciplined cost control, and strong performance in pharmacy and online channels. Continued discount store expansion, a 10% dividend increase, and ongoing share buybacks reinforce METRO’s positioning as a defensive compounder with reliable long-term value creation.

Section 2: Company Overview

Dollarama Inc. (TSX: DOL) is a Canada-based company principally engaged in operating discount retail stores. The company provides a broad range of everyday consumer products, general merchandise, and seasonal items, with merchandise at low fixed price points. General merchandise and consumer products jointly account for the majority of the company's product offerings. The company's stores are throughout Canada, generally located in convenient locations, such as metropolitan areas, midsize cities, and small towns. All the stores are owned and operated by the company. 

Kalkine’s Inflation Report covers the Investment Highlights, Key Financial Metrics, Risks, Technical Analysis along with the Valuation, Target Price, and Recommendation on the stock.

Section3:  Financial Highlights

Section 4:  Key Metrics

Below chart depicts the change in Operating Margin, Net Margins, Pretax Margin and Pretax ROA are based on Q3 2026 and Industry Median.

Section 5:  Stock Recommendation Summary

Valuation Methodology: EV to Sales Multiple Based Relative Valuation (Illustrative):

The stock has witnessed a downside of ~3.99% and ~2.17% over the last 1 week and 6 months respectively. Moreover, it is trading above the average 52-week high price of CAD 209.96 and 52-week low price of CAD 132.37, providing an opportunity to ride the trend.

One-Year Technical Price Chart (as of January 29, 2026). Source: REFINITIV, Analysis: Kalkine Group

Section 2: Company Overview

Metro Inc. (TSX: MRU) is one of the largest grocery retailers in Canada. With its 2018 acquisition of Jean Coutu, it also boasts a meaningful drugstore footprint. Noteworthy grocery banners include Metro, Metro Plus, Super C, and Food Basics, while its pharmacies primarily operate under the Jean Coutu and Brunet trademarks. It utilizes an array of business models, but it most frequently acts as either a retailer, operating individual stores, or a franchiser, licensing its trademarks and supplying merchandise to franchisees. The firm also acts as a distributor, leveraging its supply chain capabilities to service smaller neighborhood grocery stores. The preponderance of its operations is in Quebec, which houses over 70% of its owned and franchised food and drug outlets.

Kalkine’s Inflation Report covers the Investment Highlights, Key Financial Metrics, Risks, Technical Analysis along with the Valuation, Target Price, and Recommendation on the stock.

Section3:  Financial Highlights

Section 4:  Key Metrics

Below chart depicts the changes in EBITDA Margin, Net Margin, Pretax Margin and Pretax ROA are based on Q1 2026 and industry median.

Section 5:  Stock Recommendation Summary

Valuation Methodology: EV to Sales Multiple Based Relative Valuation (Illustrative):

The stock has witnessed a downside of ~9.15% and ~14.66% over the last 1 week and 6 months respectively. Moreover, it is trading above the average 52-week high price of CAD 109.20 and 52-week low price of CAD 89.13, providing an opportunity to ride the trend.

 One-Year Technical Price Chart (as of January 29, 2026). Source: REFINITIV, Analysis: Kalkine Group

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is January 29, 2026. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Dividend Yield may vary as per the stock price movement. 

Note 5: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.