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A shopper browses the aisles at the Dollarama in Vaughan, Ont.
A shopper browses the aisles at the Dollarama in Vaughan, Ont.
(JENNIFER ROBERTS For The Globe and Mail)

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Dollarama unfairly discounted in sector downdraft

U.S. dollar store stocks have had a rough week – indeed, a rough second half of 2012. There’s good reason for that. Less clear is why Canada’s Dollarama stock has been caught in the downdraft, trading down 6 per cent in the last month. Its stock is getting an unfair markdown.

The whole North American dollar store sector, including Dollarama, took a hit in October after Dollar Tree warned of disappointing third-quarter sales due in part to higher gas prices and caution among its customers. This week, it was Dollar General’s turn to offer a disappointing forecast for the year, which again weighed on dollar store stocks.