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Costco Wholesale Corporation (COST $1,004.72)
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Walmart Inc. (WMT $129.56)
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Dollarama Inc. (DOL $171.07)
Q: DOL is down around say 16% YTD, COST, WMT are up 16% and more, why do you feel this is happening with the tight $ for a lot of customers in todays economy as most families are living paycheck to paycheck.
Thanks Again
Thanks Again
5i Research Answer:
DOL would be a bit more discretionary focused while WMT and COST offer both discretionary and staple like products. So, while DOL has cheap options, it is also likely a store whose products can be cut from a customers budget if they are in a pinch. Meanwhile, you still need to shop at either WMT or COST in some form or fashion. We don't know that we would 'agree' with this line of thought but this is likely how markets are viewing things a bit here. Of course, COST and WMT also have great brands and continual execution, so some level of a premium valuation is warranted.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in COST, WMT.