Why is Canada Goose (TSX:GOOS) stock heating up?

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Why is Canada Goose (TSX:GOOS) stock heating up?

Why is Canada Goose (TSX:GOOS) stock heating up?
Image source: © 2022 Kalkine Media®     

Highlights 

  • Canada Goose Holdings Inc (TSX: GOOS) stock has been gaining quite a bit of attention from investors, especially following a recent production development.
  • The Canadian clothing company is engaged in the business of designing, manufacturing and marketing premium outwear collections.
  • The clothing stock clocked a 52-week high of C$ 67.33 on November 16, 2021.

Canada Goose Holdings Inc (TSX: GOOS) stock has been gaining quite a bit of attention from investors, especially following a recent production development.

The Canadian clothing company is engaged in the business of designing, manufacturing and marketing premium outwear collections. Formed in 1957, it presently has both retail and wholesale businesses.

Let us look at why GOOS stock is trending.

Why Canada Goose (TSX:GOOS) is trending?

The Toronto-based apparel manufacturer seems to have triggered investor interest with the recent launch of its sustainable outwear collection.

Clothes in this collection are said to be made of recycled fabrics that are 100 per cent responsibly sourced, in line with its Sustainable Impact Strategy.

Canada Goose Holdings also received Responsible Down Certification in November 2021 for embracing sustainable and efficient practices throughout its supply chain.

Also read: Saputo (TSX:SAP): What to know about the dairy stock before you buy it? 

Canada Goose stock performance

Despite the investor attention, stocks of Canada Goose plunged over two per cent and closed at C$ 41.42 apiece on Thursday, January 13.

The clothing stock clocked a 52-week high of C$ 67.33 on November 16, 2021, and hit a 52-week low of 39.78 on January 21, 2021.

The apparel stock slipped by almost 11 per cent in the last one week.

Canada Goose’s financial results in Q2 FY2022

The clothing company, which currently has a price-to-earnings (P/E) ratio of 74.50, generated a total revenue of C$ 232.9 million in the latest quarter, as compared to C$ 194.8 million in the same period a year ago.

High sales from its retail stores supported by growing e-commerce operations pushed its direct-to-consumer (DTC) revenue to C$ 83.2 million in Q2 FY2022, notably up from C$ 46.2 million a year ago.

Its wholesale revenue also increased to C$ 147.9 million in the latest quarter, as compared to C$ 118.5 million in Q2 FY2021.

The Canadian apparel company earned a net income of C$ 9 million in Q2 FY2022, which was down from C$ 10.4 million a year ago.

 Canada Goose (TSX: GOOS) financial results

 Image source: © 2022 Kalkine Media®     

Bottomline

Canada Goose expects its total revenue to range between C$ 1.12 billion and C$ 1.17 billion in FY 2022. In addition, the company expects an adjusted EBIT margin of 16.5 per cent to 17.7 per cent in fiscal 2022.

Investors should be aware of market trends and global developments like COVID-19, which can impact a company’s expectations and performance.

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