Canada Goose to buy back 10% of shares on U.S. markets

TORONTO - Canada Goose Holdings Inc . (NYSE, TSX:NYSE:GOOS), the luxury outerwear maker with a market capitalization of $1.04 billion, has received approval from the Ontario Securities Commission to proceed with the repurchase of up to 10% of its public float of subordinate voting shares through U.S. trading platforms. This move is part of the company's normal course issuer bid, which was initially announced on November 19, 2024. According to InvestingPro analysis, the company maintains strong financial health with a current ratio of 1.85, indicating solid liquidity to support such initiatives.

The authorization allows Canada Goose to exceed the standard 5% limit set for purchases on U.S. markets, enabling it to buy back shares for cancellation over a twelve-month period that began on November 22, 2024, and will end no later than November 21, 2025. The targeted repurchase volume is approximately 4,556,841 shares, based on the public float as of November 8, 2024. With impressive gross profit margins of 67.94% and current trading levels suggesting the stock may be undervalued according to InvestingPro Fair Value analysis, this buyback program could represent a strategic opportunity for the company.

The exemptive relief granted by the OSC is valid for 36 months from the date of issuance and covers any subsequent normal course issuer bids within this timeframe. The company must adhere to specific conditions, including compliance with U.S. share repurchase regulations, Canadian trading rules, and ensuring that the purchase price does not exceed the market price at the time of acquisition.

Canada Goose's decision to buy back shares follows a similar exemption obtained on January 25, 2022, which was also for a 36-month period. The company's intent is to purchase the shares on various exchanges and markets without surpassing the 10% limit of the public float as defined by the TSX.

The company, known for its luxury outerwear and apparel, has filed a copy of the OSC's decision under its SEDAR+ profile. This share repurchase plan is part of Canada Goose's strategic financial management and reflects its ongoing commitment to delivering value to shareholders. For deeper insights into Canada Goose's financial strategy and comprehensive analysis, investors can access the full Pro Research Report, available exclusively on InvestingPro, which covers detailed valuation metrics and growth prospects among 1,400+ top stocks.

Investors should note that this press release contains forward-looking statements regarding the company's repurchase plans. These statements are subject to risks and uncertainties that could affect the actual outcomes, and the company advises caution when relying on these forward-looking statements for investment decisions. The information in this article is based on a press release statement from Canada Goose Holdings Inc.

In other recent news, Canada Goose Holdings Inc. experienced a mixed second quarter for the fiscal year 2025, marked by a 5% year-over-year decline in revenue. This was primarily due to a drop in wholesale and direct-to-consumer sales, with the company attributing these outcomes to a challenging consumer environment and a strategic shift in marketing spend. However, Canada Goose remains optimistic about its long-term strategy, focusing on new product launches and marketing initiatives to boost consumer engagement and future sales.

In the context of broader industry trends, a recent analysis by Bernstein pointed to a robust start to the fourth quarter for U.S. apparel retailers, including Canada Goose. This positive trend has been largely attributed to a later than expected drop in temperatures, benefiting brands with higher average unit retail and higher-margin seasonal categories. The report also noted a recovery in spending among higher-income consumers and growth surpassing that in the Americas for companies like Canada Goose in the EMEA and APAC regions.

These recent developments suggest a complex yet promising landscape for Canada Goose and other apparel retailers. While facing immediate challenges, these companies are leveraging strategic shifts and global market trends to navigate the current retail environment. As always, the ultimate impact of these developments will depend on various factors, including consumer behavior, market dynamics, and the companies' strategic responses.

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