Dollarama (TSX: DOL) is looking to give its share price a boost via the process of repurchasing shares. The firm this morning indicated it has received TSX approval to renew its normal course issuer bid.
The program will see the company eligible to repurchase up to 18.7 million of its outstanding common shares, representing 7.5% of the firms currently issued common shares. Share buybacks are to be transacted through both the TSX as well as alternative trading systems in Canada.
Purchases may also be conducted via private agreements, in which case the company would receive a discount to the prevailing market price of the shares.
The program is set to run from July 7, 2022 through to July 6, 2023.
Under the prior program put in place, the company repurchased 15.8 million common shares at a weighted average price of $62.49 per share. That program enabled the company to repurchase up to 19.4 million shares.
The renewed program comes amid a change to the firms pricing structure. Early last month, the company indicated that it will begin to list items as high as $5.00 on its shelves as a result of rising inflation, with the changes already said to be well underway.
Analysts appear to enjoy the idea of rising prices and the related impact on earnings, with BMO recently referring to the company as being “resilient during times of high inflation,” while raising its price target to $80. Canaccord meanwhile recently lifted its price target for the company to $72, from $70.
Dollarama last traded at $75.49 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
