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It is not difficult to plan for retirement. You can achieve your retirement goals much faster if you begin saving money early in your life. More importantly, you must include some safe stocks with low volatility in your portfolio to ensure that uncertain market conditions don’t affect your retirement plan.
In this article, I’ll highlight one safe Canadian stock that I call a gem for retirement planning due to its safe business model and long track record of yielding outstanding returns for investors.
One Canadian stock you can trust for your retirement planning
Before deciding to invest in a company and making it part of your retirement planning portfolio, it’s very important for you to pay attention to the company’s business model to find out how stable it is. Dollarama (TSX.DOL) A leading Canadian value retailer with a Mont-Royal headquarters and a market cap around $22.2 million, Value Canada is the largest. It currently has nearly 1,431 discount outlets across Canada. Dollarama also sells selected products online.
Recent concerns have grown about the possibility of a recession due to rising interest rates, high inflationary pressures and rising interest rates. While it’s not easy for anyone to predict a recession, it’s always a good idea for investors to take future possibilities into consideration before investing. Overall, Dollarama’s business isn’t likely to get much affected by a recession, as the demand for its discounted essential products remains high even amid economic uncertainties.
A solid track record of delivering outstanding returns
While investing for retirement planning, investors must look at a stock’s historical track record. A stable business model will ensure that your investments continue to yield good returns, even during difficult economic times.
Dollarama’s 2009 TSX listing has brought outstanding returns to investors. To give you an idea, its stock has yielded strong double-digit positive returns in nine out of the last 10 years — even if we exclude its positive movement in the ongoing year. Although investors might not find the stock’s 0.3% dividend yield appealing, it has a solid track record of delivering outstanding returns every year. DOL stock rose more than 16% in 2020, even during the pandemic.
Dollarama shares prices have outperformed the wider market this year despite fears of recession. This Canadian safe stock trades at $76.77 per shares, with over 20% year-to date gains compared to an 11% decrease in the TSX Composite benchmark.
Financial growth trends that are strong
Dollarama is available in the April quarter reported The company’s total revenue increased 12.4% to $1.1 billion year-over-year. Comparable store sales rose by 7.3% in the context of loosening restrictions on physical activity. With the help of a double-digit increase in customer traffic and rising demand for its affordable everyday goods, the company’s adjusted earnings for the quarter jumped by 32.4% from a year ago to $0.49 per share.
I anticipate that demand for its affordable essential products will remain strong even in difficult economic times. It should also be able to sustain strong earnings growth in the next quarters and keep its stock rising.