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Key Takeaways
- Canada Goose Holdings shares fell to a new low on Monday after Barclays analysts cut their price target and downgraded the stock.
- The analysts cited increasing competition and concerns over the seasonal nature of Canada Goose's business.
- The company's U.S. business could see margin pressure because of the Trump administration's looming tariffs on Canadian imports, the analysts wrote.
Canada Goose Holdings shares (GOOS), a leading apparel manufacturer, fell to a record low on Monday after Barclays analysts downgraded its stock.
The analysts downgraded the stock to "underweight" from "equal weight" and cut their price target to $8 from $10. They "expect the competitive landscape and geopolitical factors to weigh on its performance in 2025."
Canada Goose shares fell nearly 5% on Monday afternoon, to $7.86. They had fallen as low as $7.51 in the morning session. They have lost approximately 35% of the value of their shares over the past year.
Canada Goose Facing Tariff and Competition Headwinds
According to the analysts, Canada Goose faces several headwinds, including macroeconomic pressure, competition from other luxury brands, revenue volatility due to seasonality, and "challenges expanding beyond heavyweight down into non-core product categories."
Analysts said that the Trump administration’s impending tariffs on Canadian imports will likely put pressure on U.S. margins, as nearly all the down-filled outerwear manufactured by the firm in fiscal 2024 was made in Canada and approximately 25% of its sales were in its southern neighbor. Executives have stated that they will not take any steps to reduce the impact of the 25% duty on imported finished Canadian goods. “Apart for prepositioning inventory where it could in the U.S.,” the note read.
