Canada Goose (GOOS) – Get Report shares dropped Thursday after analysts at BTIG double-downgraded the outerwear company on signals that early holiday sales are lagging.
The stock was downgraded to sell from buy with a C$35 (US$26.92) price target.
The shares traded on the New York Stock Exchange at last check were off 6.8% at $36.03. The stock has nearly tripled off its 52-week low near $13, set in mid-March. And as of Tuesday’s close, it was 3.5% below its 52-week high near $41, set last December.
“Our expectation for a revenue ramp into [the] holiday has not materialized thus far, and as such is putting [the fiscal third quarter — which represents over 100% of earnings for the year –] at risk of missing consensus estimates,” said BTIG analyst Camilo Lyon, according to Seeking Alpha.
The Toronto company’s digital traffic is down 36% year to date, according to BTIG checks, at a time when it should be surging due to increased digital activity across the retail sector in response to the coronavirus pandemic.
Additionally, the company’s maintenance of price integrity by not offering sales or discounts could sharpen demand headwinds in the near term, the analyst said.
“While we continue to hold the brand and the company in high regard,” Lyon said, “we believe a lackluster sales recovery stemming from a warmer start to winter and ensuing weak digital demand will weigh on the stock until more tangible catalysts emerge that reflect an improving earnings recapture potential, likely not until next summer.”