Sam Poser, an analyst from Williams Trading, maintained the Sell rating on Canada Goose Holdings (GOOS – Research Report). The associated price target was raised to C$13.00.
Sam Poser has given his Sell rating due to a combination of factors including Canada Goose Holdings’ recent financial performance and strategic decisions. Despite surpassing fourth-quarter revenue and EPS expectations, and making strides in cost-cutting initiatives, Canada Goose’s future appears bleak according to Poser’s analysis. The company’s guidance for FY25 EPS is optimistic due to expense reductions, yet sales and gross margin projections fall short of consensus expectations. Poser is skeptical about the company’s ability to meet its FY25 guidance, given its track record of missing the low end of initial EPS and revenue guidance by significant margins in FY23 and FY24.
Furthermore, the company’s decision to retract its ambitious FY28 targets hints at underlying challenges with consumer spending and changing business conditions that were not anticipated. This backtrack reflects the potential missteps in evolving the Canada Goose brand to meet market demands. Additionally, the plan to rationalize wholesale accounts, expected to result in a 20% drop in wholesale revenue, seems to be a reaction to diminishing consumer demand rather than a strategic consolidation, as evidenced by mutual pullbacks from longstanding wholesale partners and online promotions signaling decreased interest. The increase in average store count has not translated proportionately into direct-to-consumer sales growth, further underscoring Poser’s concerns about the brand’s current market position.
In another report released on May 16, Bank of America Securities also reiterated a Sell rating on the stock with a C$16.00 price target.
GOOS’s price has also changed moderately for the past six months – from $10.840 to $13.290, which is a 22.60% increase.
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Canada Goose Holdings (GOOS) Company Description:
Canada Goose Holdings, Inc. designs, manufactures, distributes and retails outerwear for men, women and children. It operates through the Wholesale and Direct to Consumer segments. The Wholesale segment comprises sales made to a mix of functional and fashionable retailers, including department stores, outdoor specialty stores, individual shops, and to international distributors. The Direct to Consumer segment refers to the online sales through its e-commerce sites to customers in Austria, Belgium, Canada, China, France, Germany, Ireland, Luxembourg, the Netherlands, Sweden, the United Kingdom, and the United States and sales to customers from company-owned retail stores in Boston, Calgary, Chicago, London, New York City, and Toronto. The company was founded in 1957 and is headquartered in Toronto, Canada.
Read More on GOOS:
- Canada Goose price target raised to C$21 from C$20 at CIBC
- Canada Goose price target raised to C$20 from C$19 at Raymond James
- Canada Goose price target raised to $13 from $12 at Evercore ISI
- Canada Goose price target raised to C$19 from C$16 at Wells Fargo
- Canada Goose price target raised to $20 from $17 at Baird
