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Canada Goose (TSE:GOOS)
:GOOS
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Canada Goose Holdings
(NYSE:GOOS)
67Neutral
Positive Factors
Brand Momentum
GOOS' guidance implies acceleration in DTC comps driven by better product newness and brand momentum behind the Ackerman collection.
Operational Improvements
GOOS is making good progress on its key operating initiatives including simplifying operations and improving retail execution.
Weather Impact
The cold spell that has been underway provided a boost to Canada Goose's business, likely allowing results to be within guidance.
Negative Factors
Brand Positioning
There's a disconnect between management's belief that Canada Goose is a luxury brand vs. consumers' belief that it is a premium outdoor brand.
Financial Performance
Management lowered financial expectations due to a challenging luxury consumer backdrop and increased marketing expenses.
Store Expansion Costs
Fixed costs for high rent locations remain an impediment to materially increasing the operating margin.
Canada Goose Holdings (GOOS) vs. S&P 500 (SPY)
Market Cap
C$1.11B
Dividend YieldN/A
Average Volume (3M)245.42K
Price to Earnings (P/E)15.5
Beta (1Y)1.20
Revenue Growth4.64%
EPS Growth41.68%
CountryCA
Employees4,462
SectorConsumer Cyclical
Sector Strength59
IndustryApparel - Manufacturers
Share Statistics
EPS (TTM)1.51
Shares Outstanding45,801,680
10 Day Avg. Volume152,980
30 Day Avg. Volume245,422
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$11.98Price Target Upside3.40% Upside
Rating ConsensusModerate Sell
Number of Analyst Covering7
Canada Goose Holdings 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 Holdings 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
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.72
Positive
Balance Sheet
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.65
Positive
Cash Flow
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.75
Positive
| Breakdown | ||||
| Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.33B | 1.22B | 1.10B | 903.70M | 958.10M | Gross Profit |
| 917.40M | 815.20M | 733.60M | 554.00M | 593.30M | EBIT |
| 124.50M | 135.50M | 156.70M | 116.90M | 192.10M | EBITDA |
| 244.30M | 236.50M | 263.70M | 192.10M | 255.20M | Net Income Common Stockholders |
| 58.40M | 72.70M | 94.60M | 70.30M | 148.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 144.90M | 286.50M | 287.70M | 477.90M | 31.70M | Total Assets |
| 1.48B | 1.59B | 1.34B | 1.51B | 1.11B | Total Debt |
| 728.40M | 754.00M | 620.70M | 622.60M | 386.00M | Net Debt |
| 583.50M | 467.50M | 333.00M | 144.70M | 354.30M | Total Liabilities |
| 1.06B | 1.11B | 912.70M | 907.10M | 592.50M | Stockholders Equity |
| 417.00M | 469.50M | 427.90M | 600.10M | 520.20M |
| Cash Flow | Free Cash Flow | |||
| 108.10M | 68.20M | 114.40M | 261.70M | 200.00K | Operating Cash Flow |
| 164.60M | 116.30M | 151.60M | 293.70M | 62.50M | Investing Cash Flow |
| -72.40M | -45.30M | -37.20M | -32.00M | -62.30M | Financing Cash Flow |
| -232.80M | -80.70M | -298.20M | 197.00M | -58.70M |
Canada Goose Holdings Technical Analysis
Neutral
11.59
Price Trends
12.22
Negative
13.47
Negative
14.07
Negative
Market Momentum
-0.11
Negative
50.41
Neutral
38.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GOOS, the sentiment is Neutral. The current price of 11.59 is above the 20-day moving average (MA) of 11.15, below the 50-day MA of 12.22, and below the 200-day MA of 14.07, indicating a neutral trend. The MACD of -0.11 indicates Negative momentum. The RSI at 50.41 is Neutral, neither overbought nor oversold. The STOCH value of 38.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:GOOS.
Canada Goose Holdings Risk Analysis
Canada Goose Holdings disclosed 48 risk factors in its most recent earnings report. Canada Goose Holdings 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 0 New Risks
Canada Goose Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $5.34B | 47.86 | 21.90% | ― | 17.40% | 158.89% | |
75 Outperform | $9.94B | 18.22 | 24.40% | 1.77% | 6.30% | -10.10% | |
67 Neutral | C$1.11B | 15.48 | 15.82% | ― | 4.64% | 41.68% | |
65 Neutral | $999.28M | 142.32 | 1.11% | 2.69% | 0.33% | -92.77% | |
61 Neutral | $6.64B | 11.67 | 3.04% | 3.98% | 2.60% | -21.24% | |
59 Neutral | C$116.09M | 30.45 | -19.09% | ― | 0.10% | -1665.60% | |
45 Neutral | $3.49B | 19.66 | -3.01% | 1.75% | -23.54% | -130.34% |
* Consumer Cyclical Sector Average
Performance Comparison
TSE:GOOS
Canada Goose Holdings
11.59
-4.11
-26.18%
TSE:DOO
BRP
46.80
-46.18
-49.66%
TSE:GIL
Gildan Activewear
65.97
22.04
50.18%
TSE:ATZ
Aritzia
55.87
17.98
47.45%
TSE:MTY
MTY Food Group
43.28
-4.34
-9.11%
TSE:ROOT
Roots Corporation
2.81
0.41
17.08%
Canada Goose Holdings Earnings Call Summary
Earnings Call Date:Feb 06, 2025
(Q3-2025)
| % Change Since: -24.05%|
Next Earnings Date:May 21, 2025
Earnings Call Sentiment Neutral
The earnings call reflected strategic advancements and strong regional performances, particularly in North America and Japan, buoyed by the successful Snow Goose launch. However, it was tempered by declines in wholesale revenue and challenges in Greater China and EMEA markets. Despite improvements in gross margin and inventory management, the decline in DTC comparable sales and elevated SG&A expenses present ongoing challenges.Q3-2025 Updates
Positive Updates
Strong North America DTC Performance
In North America, DTC comparable sales grew 3% in Q3 with a 22% increase in December, driven by marketing activation and strategic team execution.
Successful Snow Goose Launch
The Snow Goose capsule collection achieved a record 30 billion media impressions, with 25% of buyers also purchasing mainline products and a 3-year high in US search interest.
Inventory Management Improvements
Q3 inventory decreased 15% year-over-year, marking the fifth consecutive quarter of reduction, reflecting improved planning and operational processes.
EMEA and Japan Growth
EMEA saw improved conversion rates despite traffic challenges, and Japan's DTC performance improved significantly year-over-year with two new store openings.
Gross Margin Expansion
Gross margin expanded by 70 basis points to 74.4%, driven by favorable pricing and reduced inventory provisions.
Negative Updates
Wholesale Revenue Decline
Wholesale revenue declined 8%, aligning with the strategy to reduce wholesale order volume, with expected full-year decline of approximately 20%.
Challenges in Greater China
APAC revenue fell 2%, primarily due to macroeconomic factors impacting DTC in Greater China, leading to slower traffic.
DTC Comparable Sales Decline
DTC comparable sales declined 6%, with a particularly challenging November, leading to a revised full-year outlook to a mid-single-digit decrease.
SG&A Expense Concerns
SG&A as a percentage of revenue remains higher year-over-year for both Q3 and year-to-date, driven by increased direct costs and lower traffic.
Company Guidance
During the Canada Goose Third Quarter Fiscal Year 2025 earnings call, the company highlighted several key metrics and strategic initiatives that shaped their performance. Revenue for the third quarter was $608 million, slightly lower than the previous year's $610 million, primarily due to an 8% decline in Wholesale revenue. However, the direct-to-consumer (DTC) business showed positive momentum, with a 6% negative comparable sales decline, but a significant 22% growth in North American comp sales in December. This improvement was attributed to the successful launch of the Snow Goose capsule collection, which generated over 30 billion media impressions and drove brand engagement. The company also achieved a 15% year-over-year reduction in inventory, marking the fifth consecutive quarter of inventory decreases. Despite macroeconomic pressures, Canada Goose maintained its adjusted EBIT margin at 33.8%, slightly down from 34% the previous year. Looking ahead, the company adjusted their full-year DTC comparable sales outlook to range from flat growth to a mid-single-digit decrease, while maintaining their revenue guidance within a range of a low-single-digit increase to a low-single-digit decline compared to fiscal 2024.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.