Shares of Canada Goose Holdings (NYSE:GOOS) were flying higher last month as the high-end parka maker gained alongside strong results from its retail peers. Then toward the end of the month, the company launched its growth strategy for China. According to data from S&P Global Market Intelligence, the stock finished the month up 13%. The chart below tells the tale.
Like other retail stocks, Canada Goose seemed to move higher in the middle of the month on strong reports from retail peers like Macy's. The stock gained 3.3% on May 15 and then added another 3.2% on May 16, the day Macy's report came out and pushed up a slew of retail stocks.
However, Canada Goose's best day in May came on the last day of the month when the stock gained 5.6% as the company detailed its entry into the Chinese market. The company said it would open a regional head office in Shanghai, launch a direct-to-consumer business in the country through Alibaba's Tmall, and open two retail stores, one in Shanghai and the other in Beijing.
CEO Dani Reiss explained the move, saying, "As the world's largest luxury market, the opportunity for Canada Goose in China is massive. We have already seen exceptional demand from Chinese consumers -- locally and internationally -- for years, and we are excited to bring our authentic and immersive retail and e-commerce experience directly to our fans there."
Canada Goose could find a rich opportunity in China as the Chinese are known for conspicuous consumption, and the company has succeeded in making a luxury item out of winter coats. Canada Goose has slowly been expanding its retail footprint with new stores in Europe, among other moves to enhance the business, and going to China looks like a smart choice.
We should learn more about the opportunity, as well as its latest results, when the company releases its full-year earnings, which should come out later this month.