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As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Canada Goose Holdings Inc. (TSE:GOOS), it is a financially-sound company with a great history and a excellent growth outlook. Below, I've touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, take a look at the report on Canada Goose Holdings here.
Solid track record with high growth potential
One reason why investors are attracted to GOOS is its notable earnings growth potential in the near future of 24%. The optimistic bottom-line growth is supported by an outstanding revenue growth of 51% over the same time period, which indicates that earnings is driven by top-line activity rather than purely unsustainable cost-reduction initiatives. Over the past few years, GOOS has demonstrated a proven ability to generate robust returns of 36% Not surprisingly, GOOS outperformed its industry which returned 13%, giving us more conviction of the company's capacity to drive bottom-line growth going forward.
GOOS's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that GOOS manages its cash and cost levels well, which is an important determinant of the company’s health. GOOS appears to have made good use of debt, producing operating cash levels of 0.51x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For Canada Goose Holdings, there are three important factors you should further examine:
- Valuation: What is GOOS 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 GOOS is currently mispriced by the market.
- Dividend Income vs Capital Gains: Does GOOS return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Our historical dividend yield visualization quickly tells you what your can expect from GOOS as an investment.
- Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of GOOS? Explore our interactive list of stocks with large 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 firstname.lastname@example.org. 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.