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Canada Goose Holdings Inc. (TSE:GOOS): Poised For Long Term Success?

Simply Wall St

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After Canada Goose Holdings Inc.'s (TSE:GOOS) earnings announcement on 31 March 2019, it seems that analyst forecasts are fairly optimistic, with earnings expected to grow by 33% in the upcoming year, though this is evidently lower than the past 5-year average earnings growth of 54%. By 2020, we can expect Canada Goose Holdings’s bottom line to reach CA$191m, a jump from the current trailing-twelve-month of CA$144m. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.

See our latest analysis for Canada Goose Holdings

Exciting times ahead?

The longer term view from the 16 analysts covering GOOS is one of positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.

TSX:GOOS Past and Future Earnings, June 24th 2019

This results in an annual growth rate of 24% based on the most recent earnings level of CA$144m to the final forecast of CA$302m by 2022. This leads to an EPS of CA$2.66 in the final year of projections relative to the current EPS of CA$1.31. In 2022, GOOS's profit margin will have expanded from 17% to 21%.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For Canada Goose Holdings, I've put together three essential factors you should further examine:

  1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
  2. Valuation: What is Canada Goose Holdings worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Canada Goose Holdings is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Canada Goose Holdings? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.