Shares of Canada Goose Holdings Inc. were up 12 per cent last week after media reports that the majority shareholder of the luxury outerwear, apparel and accessories manufacturer was in talks to sell its stake in the company.
 

CNBC reported late Tuesday that private equity firm Bain Capital was in early stage talks for a possible deal that would see Canada Goose go private, citing sources who are familiar with the discussions.

Bain Capital declined to comment on the story, and Canada Goose did not respond to the Financial Post’s request for comment.

Bain acquired a controlling stake in Canada Goose in 2013 for an undisclosed amount. As of March 30, Bain owned approximately 60.5 per cent of outstanding multiple voting shares, or 55.5 per cent of combined voting power in the company, according to filings with the U.S. Securities and Exchange Commission.

Canada Goose’s chief executive, Dani Reiss, owns approximately 39.5 per cent of outstanding multiple voting shares, or 36.2 per cent of the combined voting power.

Founded in 1957 in Toronto, Canada Goose built its brand on made-in-Canada down-filled parkas and has since expanded its outerwear offerings to raincoats, bombers and lightweight jackets, as well as clothing, shoes and accessories. The company has 74 stores across North America, Europe and Asia.

The company went public on the S&P/TSX composite index and New York Stock Exchange in 2017 and hit a peak market valuation of US$7.7 billion the following year. Canada Goose’s stock is up 24 per cent this year on the TSX and 30 per cent on the NYSE.

The possibility of Canada Goose going private makes sense given the quality of the brand and “big margin expansion opportunity,” according to a TD Cowen report.

Analysts noted that the company is in the “early innings” of fashion and product changes and said its stores could be running 20 to 30 per cent below prior productivity peaks “given changes in tourism, geopolitical and regional volatility, some of which are permanent.”

“But this opportunity for growth combined with the pre-existing opportunity for increasing non-heavyweight outerwear product are the building blocks for value creation,” analysts Oliver Chen, Jonna Kim and Tom Nass said in a note.

TD Cowen said potential risks for Canada Goose include maintaining its “premium brand equity” in new and existing markets, brand saturation in core markets such as Canada and the United States and high levels of seasonality and product concentration, as winter jackets and parkas make up an estimated 65 to 75 per cent of the brand’s sales mix.

Events that affect global travel or spending patterns could also impact Canada Goose’s earnings potential, as TD Cowen estimates that 30 per cent of the company’s revenue is linked to global tourism.

After three consecutive years of revenue growth in 2022, 2023 and 2024, Canada Goose reported a decline of 1.1 per cent to $1.35 billion in fiscal year 2025 (all figures on a constant currency basis), which ended in March. The company reported a “strong start” to fiscal year 2026, as first-quarter revenue grew 21.5 per cent year-over-year, but it also posted a net loss of $125.5 million.

Canada Goose didn’t issue a fiscal 2026 outlook as it faced “quite a bit of uncertainty” around

tariffs

and the evolving trade environment, chief financial officer Neil Bowden said on a call with analysts in July.

However, Bowden said 75 per cent of the company’s wares are made in Canada, and “virtually all” are compliant under the Canada–United-States–Mexico Agreement (CUSMA), making them immune to U.S. tariffs.

  • Canada Goose beats revenue estimate on higher consumer sales
  • Canada Goose’s private equity backer is said to weigh stake sale

In the near term, TD Cowen said macroeconomic headwinds in key growth markets such as China “could sideline growth investments and store openings necessary to fuel earnings growth.” Canada Goose also faces risks related to expanding into new product categories and “potential deceleration” in North American markets.

But the analysts also said Canada Goose has a lot going for it: “powerful” brand equity, a vertically integrated supply chain with potential to bring more manufacturing in-house and opportunities to widen its customer base through global growth, product category expansion and direct-to-consumer sales.

“Long term, we remain optimistic on Canada Goose’s growth potential.”

• Email: jswitzer@postmedia.com