Canada Goose (GOOS:CN) (GOOS) PT Lowered to Cdn$60 at Wells Fargo Following Earnings

May 13, 2021 1:00 PM EDT
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Price: $39.95 -1.63%

Rating Summary:
    11 Buy, 7 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 10 | Down: 8 | New: 61
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Wells Fargo analyst Ike Boruchow lowered the price target on Canada Goose (GOOS:CN) (NYSE: GOOS) to Cdn$60.00 (from Cdn$68.00) while maintaining an Overweight rating following earnings

The analyst commented, "Solid momentum in the business, market overly focused on outlook, we see buying opportunity. Bigger picture, GOOS’ past few quarters have shown a strong rebound in trajectory – with accelerating growth in their China and digital channels (which are key drivers to the bull case). The issue today is their outlook; mgmt opted to take a very cautious view on the DTC business over the next 12 months (assuming no meaningful rebound in global tourism) – and stating that margins could remain below ~20% until tourism normalizes. We aren’t overly concerned, as we beleive the model has momentum and the outlook reasonably cautious given the pandemic and seasonality of the business (especially with GOOS' leverage to Canada which remains under pressure). We also note that mgmt appears confident that the margin structure will eventually revert to the ~25% range seen pre-COVID. All in, we view this as a buying opportunity and see the setup as favorable from here. That said, lowering FY22/23E EPS to $1.00/$1.66 (from $1.62/$2.06) and PT to $60 (from: $68) due to concerns on NT profitability."

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