With Boxing Day and the festive season all wrapped up, investors should begin to focus on the retail names that could deliver upside surprises in the new year, perhaps on the back of stronger consumers. Indeed, it's been a rather tough past year for consumer spending, but things could change for the better as the Canadian economy looks to move past a period of relative sluggishness.

With the Canadian dollar rallying on Monday, perhaps the worst of the weak loonie is in the rear-view mirror as the Bank of Canada looks to consider its next move while the nation looks to make steps to sidestep potential 25% tariffs that could be imposed by Trump pretty soon.

Either way, I think the Canadian retail scene is very interesting for its modest valuation and the potential for multiple expansion through the next two to three years. Here are two names that I view as dirt cheap this January.

Dollarama

In the U.S. market, the dollar-store chains have been under quite a bit of pressure, with some of the better-known brands imploding by double-digit percentage points. Meanwhile, it's been off to the races for Dollarama (TSX:DOL), whose shares have been up a whopping 45% in the past year.

Indeed, Dollarama has thrived in the Canadian market by offering a wide line-up of goods at rather attractive prices. As Canadians continue to go bargain hunting, Dollarama could have an opportunity to scale up its growth rate as it continues its lengthy nationwide expansion. Indeed, we don't have enough Dollaramas in any given town!

The major knock against shares may be its seemingly hefty 35.5 times trailing price-to-earnings (P/E) multiple. Given the growth narrative (expansion plus the retailer's market dominance), I'd argue shares are cheap after slipping 8% in the past two months. On a forward-looking basis, DOL stock goes for 28 times forward P/E, which isn't all too unreasonable for such a high-quality defensive with ample growth left in the tank.

My takeaway? Dollarama is a dependable consumer stock that could keep rising, regardless of what consumers are in for in 2025.

Aritzia

Aritzia (TSX:ATZ) is another "growthy" retail play that's looking like a compelling buy to start the new year. At $58 and change per share, Aritzia is at fresh 52-week highs after a 126% gain in the past year. If the women's clothing retailer can continue crushing on earnings (a report is just ahead), a breakout could be in the cards. Either way, I view the small $6.5 billion clothing retailer as a growth gem for those who are bullish on the firm's growth runway in the U.S. market.

Indeed, expansion south of the border could be a source of significant growth that could keep the good times rolling. In any case, it's time to give the brand a closer look as it builds an economic moat around its offerings. At 24.1 times forward P/E, I also view shares of ATZ as cheap relative to the growth rate. So, if you seek strength in retail, look no further than the name as it nears all-time highs again.