Wells Fargo downgraded Canada Goose Holdings Inc. to underweight from equal weight on Monday, citing broad macroeconomic headwinds that are expected to pressure the premium outerwear brand’s near-term performance.
The U.S. bank set a price target of C$10.00 for Canada Goose, down from its prior stance, and lowered its earnings estimates below consensus. The move follows a 30% decline in the company’s shares over the past six months, leaving the stock trading near its 52-week low of US$8.42.
Wells Fargo’s decision reflects concerns over El Niño weather patterns, tariff risks and challenges across Europe, the Middle East and Africa. The downgrade contrasts with the company’s first-quarter results, which exceeded Wall Street expectations for revenue and earnings despite an adjusted loss of US$0.627 per share, narrower than the projected US$0.72 per share loss.
Analysts had anticipated a brand inflection point driven by aggressive reinvestments in marketing and product design over the prior 18 to 24 months. While wholesale demand and margin improvements supported results, investors remained cautious amid ongoing losses and uneven regional demand. Nine analysts have since revised their earnings estimates downward for the upcoming period.
The downgrade follows Wells Fargo’s broader reassessment of Canada Goose’s valuation framework, which previously assumed sustained revenue growth across all channels with margins improving as spending scaled back. The bank now views the macro backdrop as a greater near-term risk to the company’s outlook.
