While it’s easy to spread your Tax Free Savings Account (TFSA) investments too thinly in an attempt to capture profits from every market sector, there’s a better way to go about it. What if just one Canadian stock, with a long history of strong growth, a rock-solid business model and solid future growth fundamentals, was enough to take your TFSA into seven figures?
Dollarama (TSX:DOL) has quietly done that. It may not be one of the most popular stocks on the market Toronto Stock Exchangebut the performance speaks louder than any trend. Positive double-digit returns in 14 of the last 15 years and a business model that continues to expand into new geographies even amid macroeconomic uncertainties make it a serious buy-and-hold stock for the long term, especially for TFSA investors who want to avoid taking unnecessary risks.
In this article, I’ll talk about why Dollarama might be the only top TFSA stock you need in your portfolio.
Why Dollarama Could Be Your TFSA’s Long-Term Winner
Simply put, Dollarama’s business is built on one simple promise: value pricing. As Canada’s largest discount retailer, the company operates more than 1,600 stores across the country and recently expanded its reach to seven countries through its subsidiaries. With its latest move into Australia via the acquisition of The Reject Shop, the Canadian discount retailer has taken its proven model globally.
This TFSA-friendly stock is currently trading at $180.30 per share, giving the company a market cap of $49.5 billion and a small but consistent annualized dividend yield of around 0.23%. While that dividend may not seem impressive, Dollarama’s strength lies in its consistent share price growth. In the past year alone, the stock is up nearly 25%, extending its five-year gain to more than 280%.
Impressive financial growth trend shows the momentum
In the second quarter of fiscal 2026 (three months ending in July), the retailer reported a 10.3% year-over-year (YoY) increase in sales to $1.72 billion. This sales growth is primarily driven by robust same-store sales growth in Canada and early contributions from the new Australian operations. Notably, comparable store sales in Canada increased 4.9% year over year, driven by increased demand for consumables.
As a result, the company’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) rose more than 12% year over year to $588.5 million. The increasing profitability clearly shows how well Dollarama is managing costs even as it expands its store network and absorbs the short-term impact of new acquisitions.
Growth-oriented expansion strategy
Dollarama’s recent acquisition of The Reject Shop marks its first entry into the Australian market, adding almost 400 stores and opening the door to one of the world’s most attractive discount retail spaces. Meanwhile, Latin American partner Dollarcity is rapidly expanding, as it recently opened its first store in Mexico, reaching 658 stores in five countries.
Using this expansion strategy, Dollarama’s efficient purchasing model, fixed price structure and disciplined cost control are now being adopted in new markets where consumers are as value-oriented as Canadians. And that seems like a great formula for sustainable global growth.
Why it fits perfectly into a TFSA strategy
For TFSA investors, long-term consistency and tax-free compounding are two main goals. And Dollarama’s combination of stability, expansion prospects and proven stock performance makes it the top stock for TFSA investors who want long-term, low-stress returns on their hard-earned money.
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