The clothing scene can be a pretty difficult place to invest, especially if you are a new investor who is not entirely sure what is in fashion and how long something will remain fashionable. Despite the complexities of selected fashion, I think we see that some of the established operators are losing a considerably meaningful market share to some smaller, disturbing up-and-comers. It is indeed difficult to gauge the full power of a brand.
Perhaps the economic canal of a Swoosh or Slogan is almost not worth as much as the company behind the logo does not innovate. In any case, I would rather be in a smaller, emerging mid-cap industry with room to expand than a company that can be guilty of complacency as competition in the kingdom of clothing, becomes a little more fierce every day. Fashion can indeed be a difficult place to earn a lot of money.
But a name that I think it stands out of the peloton is Canadian women’s clothing company Aritzia (TSX: ATZ), which has surprisingly good with his relatively early expedition in the American markets. Until now, the name was more rate resilient than I had ever thought. And although things can change with time, I see Aritzia as a household staple that is about to be a huge tree.
Indeed, if you are Canadian, you are probably already familiar with the brand. And while Americans just warm up at the retailer, I see their early success as a hint of what we can expect from the company, because it seems to add to his recent power and put some extra pressure on his fashionable rivals south of the border.
Artizia Stock is getting hotter
Now that ATZ shares are still achieving 3.2% on Wednesday’s solid session, the questions are about what the next big step of the rapidly rising $ 8.8 billion star will be. Personally, I think that ATZ shares, although somewhat rich of just 39 times chase price profit (p/e) or 29 times in advance, one of those market expansion stories is worth paying a premium.
Aritzia is indeed still a relatively small fish on the massive clothing market. And if it can continue to sprint in the US despite rates, inflation and other economic setbacks, I see it as one of the following big banners to disturb American fashion as we know it.
Although I am not happy to pay premium prices, I have to say that Aritzia has all the start of a really great fast-growing company that can grow in his superior. Whether Aritzia is the new rival that needs the American fashion scene remains the question of several billions of dollars. Anyway, several analysts are cheerful about the expansion potential of the company.
More growth ahead
The company is ready to open new stores here in Canada and the US in the coming years. And without plans to pass on rates to consumers (the margins of Artizia are already quite considerable), I do not expect that the question will decrease soon. Perhaps, perhaps eating the rate and finding other ways to limit costs is the best move at a time when the consumer experiences several headwinds.
If Aritzia can continue to share, I think things are going well, even in a mixed economy. That is why I stay Bullish with more than $ 76 per share. It is a great Canadian growthary that is still in its infancy.
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