Canada Goose (GOOS) AI Stock Analysis

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Canada Goose

(TSX:GOOS)

Rating:67Neutral

Price Target:―

Canada Goose Holdings shows strengths in financial performance, particularly in cash flow and operational efficiency, but faces challenges with margin pressure and high leverage. Technical analysis suggests mixed signals with bearish momentum. Valuation metrics indicate fair valuation, and earnings call insights reveal strategic strengths but also highlight regional challenges and sales declines.

Positive Factors

Sales Growth

The need for cold weather and Canada Goose needed position as an outdoor brand was highlighted by the 22% December YoY SSS increase as weather was frigid in North America.

Strategic Partnerships

The company is moving in the right direction given corporate expense reductions through the transformation program, partnership with Haider Ackermann to launch new product, and focusing on driving better store productivity.

Negative Factors

Brand Positioning

There's a disconnect between management's belief that Canada Goose is a luxury brand, vs. consumers' belief that Canada Goose is a premium outdoor brand.

Operating Margin Challenges

As the Canada Goose store base has increased from 11 in FY19 to 68 in FY24, operating margin has decreased 1180bps to 13.1%.

Revenue Performance

3Q revenue came in below Street's estimate at C$608mm versus Street's C$620mm primarily on lower than expected DTC comp of -6.2%.

Canada Goose (GOOS) vs. iShares MSCI Canada ETF (EWC)

Market Cap

$1.20B

Dividend YieldN/A

Average Volume (3M)198.23K

Price to Earnings (P/E)15.1

Beta (1Y)1.25

Revenue Growth4.64%

EPS Growth41.68%

CountryCA

Employees4,462

SectorConsumer Cyclical

Sector Strength74

IndustryApparel - Manufacturers

Share Statistics

EPS (TTM)0.33

Shares Outstanding45,801,680

10 Day Avg. Volume180,547

30 Day Avg. Volume198,229

Financial Highlights & Ratios

PEG Ratio0.66

Price to Book (P/B)2.23

Price to Sales (P/S)0.00

P/FCF Ratio5.48

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$14.35

Price Target Upside-2.95% Downside

Rating ConsensusModerate Sell

Number of Analyst Covering10

Canada Goose Business Overview & Revenue Model

Company DescriptionCanada Goose Holdings Inc. designs, manufactures, and sells performance luxury apparel for men, women, youth, children, and babies in Canada, the United States, Asia Pacific, Europe, the Middle East, Africa, and Latin America. The company operates through three segments: Direct-to-Consumer, Wholesale, and Other. It offers parkas, lightweight down jackets, rainwear, windwear, knitwear, footwear, and accessories for fall, winter, and spring seasons. As of April 3, 2022, the company operated through its 56 national e-commerce markets and 41 directly operated retail stores in North America, Europe, and Asia Pacific. It also sells its products through wholesale partners and distributors. The company was founded in 1957 and is headquartered in Toronto, Canada.

How the Company Makes MoneyCanada Goose Holdings Inc. generates revenue primarily through the design, manufacturing, and sales of its premium outerwear and apparel. The company's revenue model is largely retail-driven, with significant earnings derived from direct-to-consumer sales through its branded retail stores and e-commerce platforms. Additionally, Canada Goose engages in wholesale distribution, partnering with luxury department stores and specialty retailers around the world. Key revenue streams include the sale of parkas, jackets, knitwear, and accessories, with a focus on expanding its product offerings and market reach. Strategic partnerships, seasonal collections, and collaborations with designers and influencers also contribute to its financial performance.

Canada Goose Financial Statement Overview

Summary

Canada Goose Holdings exhibits solid financial performance with robust revenue and cash flow growth. Despite some profit margin compression and high leverage, the company maintains operational efficiency and strong cash generation, crucial for future growth and debt reduction.

Income Statement

Positive

Canada Goose Holdings has shown consistent revenue growth with a current TTM revenue of CAD 1,325 million, up from CAD 1,218 million in the previous period. The gross profit margin remains robust at approximately 63.6%, underscoring strong production efficiency and pricing power. However, the net profit margin has compressed slightly, standing at 5.5% for the TTM, suggesting rising costs or other operational challenges. EBIT and EBITDA margins also reflect stable operational performance at 10.2% and 20.7%, respectively.

Balance Sheet

Positive

The company's balance sheet reveals a high debt-to-equity ratio of 1.68, which might imply a higher financial risk due to leverage. Return on equity is moderate at 14.7%, suggesting efficient use of shareholder funds to generate income. The equity ratio is at 28.7%, indicating a reasonable level of asset financing through equity, though there is room for improvement in reducing reliance on debt.

Cash Flow

Positive

Canada Goose has demonstrated significant growth in free cash flow, with a 97% increase from the previous period, reflecting strong cash generation capabilities. The operating cash flow to net income ratio is robust at 3.27, indicating strong cash conversion from earnings. The free cash flow to net income ratio is also healthy at 2.93, highlighting efficient capital expenditure management.

TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Breakdown
Income Statement		Total Revenue
1.32B	1.33B	1.22B	1.10B	903.70M	958.10M
	Gross Profit
843.40M	917.40M	815.20M	733.60M	554.00M	593.30M
	EBIT
135.80M	124.50M	135.50M	156.70M	116.90M	192.10M
	EBITDA
273.90M	244.30M	236.50M	263.70M	192.10M	255.20M
	Net Income Common Stockholders
72.70M	58.40M	72.70M	94.60M	70.30M	148.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
30.18M	144.90M	286.50M	287.70M	477.90M	31.70M
	Total Assets
442.06M	1.48B	1.59B	1.34B	1.51B	1.11B
	Total Debt
266.30M	728.40M	754.00M	620.70M	622.60M	386.00M
	Net Debt
236.12M	583.50M	467.50M	333.00M	144.70M	354.30M
	Total Liabilities
373.96M	1.06B	1.11B	912.70M	907.10M	592.50M
	Stockholders Equity
68.10M	417.00M	469.50M	427.90M	600.10M	520.20M
Cash Flow		Free Cash Flow
213.00M	108.10M	68.20M	114.40M	261.70M	200.00K
	Operating Cash Flow
237.50M	164.60M	116.30M	151.60M	293.70M	62.50M
	Investing Cash Flow
-28.10M	-72.40M	-45.30M	-37.20M	-32.00M	-62.30M
	Financing Cash Flow
-85.10M	-232.80M	-80.70M	-298.20M	197.00M	-58.70M

Canada Goose Technical Analysis

Technical Analysis Sentiment

Positive

Last Price14.79

Price Trends

50DMA

11.78

Positive

100DMA

13.27

Positive

200DMA

13.88

Positive

Market Momentum

MACD

0.46

Negative

RSI

76.45

Negative

STOCH

75.57

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GOOS, the sentiment is Positive. The current price of 14.79 is above the 20-day moving average (MA) of 12.11, above the 50-day MA of 11.78, and above the 200-day MA of 13.88, indicating a bullish trend. The MACD of 0.46 indicates Negative momentum. The RSI at 76.45 is Negative, neither overbought nor oversold. The STOCH value of 75.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:GOOS.

Canada Goose Risk Analysis

Canada Goose disclosed 48 risk factors in its most recent earnings report. Canada Goose reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 3 New Risks

Our business could be harmed if we fail to manage our operations and future growth effectively, or if we fail to successfully execute our Transformation Program. Q1, 2024

Fluctuations in the price or quality of, or disruptions in the availability of, raw materials used in our products from a limited number of third-party suppliers could cause us to incur increased costs or disrupt our manufacturing processes. Q1, 2024

The markets in which we operate are highly competitive. Q1, 2024

Canada Goose Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GOOS	67 Neutral	$1.20B	15.14	19.34%	―	4.64%	41.68%
Sector *	62 Neutral	$6.97B	11.36	2.77%	3.91%	2.66%	-22.00%
GIL		$7.63B	19.45	24.40%	1.67%	―	―
PBL	72 Outperform	C$530.53M	13.27	12.45%	1.04%	11.03%	18.83%
ROOT	59 Neutral	C$133.49M	30.45	-19.09%	―	0.10%	-1665.60%
UNI	52 Neutral	C$23.58M	―	-30.57%	―	-8.08%	46.56%
ATZAF		$4.48B	34.79	21.90%	―	―	―

* Consumer Cyclical Sector Average

Performance Comparison

TSE:GOOS

Canada Goose

14.79

-4.45

-23.13%

GIL

Gildan Activewear

48.87

13.96

39.99%

TSE:PBL

Pollard Banknote

18.60

-12.69

-40.56%

TSE:UNI

Unisync

1.25

-0.33

-20.89%

TSE:ROOT

Roots Corporation

3.26

0.94

40.52%

ATZAF

Aritzia

45.75

22.43

96.18%

Canada Goose Earnings Call Summary

Earnings Call Date:May 22, 2025

(Q4-2025)

% Change Since: -3.08%|

Next Earnings Date:Aug 07, 2025

Earnings Call Sentiment Neutral

The earnings call reflected a mix of positive growth in revenue, gross margin, and direct-to-consumer performance, with significant challenges in wholesale revenue and regional sales in EMEA and China. Inventory management showed positive results, but there was an increase in SG&A costs. The company is cautious due to uncertainties in the global trade environment.

Q4-2025 Updates

Positive Updates

Revenue Growth

Fourth quarter revenue increased by 7% year-over-year, with D2C comparable sales growth of 7%.

Gross Margin Improvement

Gross margin expanded by 620 basis points in Q4 to 71.3% and 69.9% for the full year.

D2C Sales Performance

D2C revenue increased to $314 million, up 12% year-over-year, with North America leading with a 17% comp growth for the quarter.

Inventory Management

Inventory was reduced by 14% year-over-year, with inventory turns reaching 1.0x, up from 0.9x last year.

Marketing Campaign Success

Marketing campaigns such as Sea Mantra and eyewear resulted in a 19% year-over-year increase in global brand search demand.

Adjusted EBIT Growth

Adjusted EBIT for Q4 was $60 million, up 49% year-over-year, with a margin expansion of 430 basis points.

Negative Updates

Wholesale Revenue Decline

Wholesale revenue declined by 18% for the full year, primarily due to strategic order book rationalization and challenging EMEA conditions.

Challenges in EMEA and China

D2C comparable sales growth in EMEA was negative 7% for the full year, and in APAC, it was negative 10%.

SG&A as a Percentage of Revenue

SG&A as a percent of revenue increased by 220 bps year-over-year in Q4 and 130 bps for the full year, indicating challenges in cost management.

Uncertain Global Trade Environment

Decision not to provide financial outlook for fiscal 2026 due to uncertainties in the global trade environment and macroeconomic conditions.

Company Guidance

During the Canada Goose Fourth Quarter Fiscal 2025 Earnings Call, the company reported a strong finish to the fiscal year with a 7% year-over-year increase in revenue, driven by a 7% growth in direct-to-consumer (D2C) comparable sales. Notably, the company saw a 19% year-over-year rise in global brand search demand, particularly boosted by its marketing campaigns for Sea Mantra and eyewear. Inventory management was a key focus, with inventory down year-over-year for six consecutive quarters. In the North American D2C sector, there was a robust 17% sales comp increase for the quarter. The company's gross margin expanded by 620 basis points to 71.3% in Q4, and adjusted EBIT increased by 49% year-over-year to $60 million, with an adjusted EBIT margin of 15.5%. The company also reported a significant improvement in inventory turnover, achieving 1.0x up from 0.9x the previous year. Despite the positive financial results, Canada Goose decided not to provide a financial outlook for fiscal 2026 due to global trade uncertainties, although they emphasized their strategic focus on brand heat, product expansion, and operational efficiency.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.