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1. Company Snapshot

1.a. Company Description

Columbia Sportswear Company, together with its subsidiaries, designs, sources, markets, and distributes outdoor, active, and everyday lifestyle apparel, footwear, accessories, and equipment in the United States, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and Canada.The company provides apparel, accessories, and equipment that are used in various activities, such as skiing, snowboarding, hiking, climbing, mountaineering, camping, hunting, fishing, trail running, water sports, yoga, golf, and adventure travel.It also offers footwear products that include lightweight hiking boots, trail running shoes, rugged cold weather boots for activities on snow and ice, sandals and shoes for use in water activities, and function-first fashion footwear and casual shoes for everyday use.


The company sells its products under the Columbia, Mountain Hardwear, SOREL, and prAna brand names through the company owned network of branded and outlet retail stores, brand-specific e-commerce sites, and concession-based arrangements with third-parties at branded outlet and shop-in-shop retail locations, as well as through independently operated specialty outdoor and sporting goods stores, sporting goods chains, department store chains, Internet retailers, and international distributors.As of December 31, 2021, it operated approximately 455 retail stores.The company was founded in 1938 and is headquartered in Portland, Oregon.

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1.b. Last Insights on COLM

Columbia Sportswear's recent performance was positively driven by the successful execution of its ACCELERATE strategy, which fuels growth through brand innovation and global expansion initiatives. The company's Q3 earnings of $1.41 per share surpassed estimates, beating the Zacks Consensus Estimate of $1.21 per share. Additionally, institutional investors such as Sequoia Financial Advisors LLC have shown confidence in the company, buying a new stake of 5,477 shares. Despite an average rating of "Reduce" from analysts, Columbia Sportswear's product and marketing innovation, including new campaigns and higher-priced items, offer potential positives.

1.c. Company Highlights

2. Columbia Sportswear's Q3 Earnings: A Mixed Bag

Columbia Sportswear Company's third quarter results were a mixed bag, with net sales increasing 1% year-over-year to $943 million, driven by earlier-than-planned shipments of fall '25 wholesale orders. However, gross margin declined 20 basis points to 50% due to higher tariff expenses and foreign exchange headwinds. The company's diluted earnings per share (EPS) came in at $0.95, including $29 million in noncash impairment charges related to prAna and Mountain Hardwear. Notably, the actual EPS for the full year is likely to be $1.41, beating estimates of $1.19.

Publication Date: Nov -04

📋 Highlights
  • International Sales Growth:: LAAP net sales up 6%, China mid-single-digit, EMEA +10% (EMEA driven by Europe direct business).
  • Net Sales Increase:: $943 million (+1% YoY) fueled by early fall '25 wholesale shipments, with wholesale up 5% and DTC down 5%.
  • Gross Margin Pressure:: 50% margin (-20 bps) impacted by higher tariffs ($29M impairment charges for prAna/Mountain Hardwear) and FX headwinds.
  • DTC Decline Factors:: U.S. DTC down 5% in Q3, 90% attributed to temporary clearance store closures and over-promotion in prior periods.
  • Full-Year Outlook Adjusted:: Net sales guidance $3.3–$3.4 billion (flat to -1% YoY), with Q4 sales projected to decline 5–8% due to DTC softness.

Segment Performance

The international markets performed well, with LAAP net sales increasing 6%, China net sales increasing mid-single-digit percent, and EMEA net sales increasing 10%. The SOREL brand also saw a 10% increase in net sales. However, the direct-to-consumer business in the U.S. was down 5%, attributed to the lack of temporary clearance stores and over-promotional activity in prior periods, as noted by Timothy Boyle, "90% of the decline is due to the temporary clearance stores, with the remaining 10% attributed to decreased productivity in existing stores."

Outlook and Guidance

The company expects net sales to decline 5% to 8% year-over-year in the fourth quarter and diluted EPS to be in the range of $1.04 to $1.34. The full year net sales outlook is $3.3 billion to $3.4 billion or flat to down 1% year-over-year. Analysts estimate next year's revenue growth at 2.0%, indicating a potential slowdown.

Valuation

Columbia Sportswear's current valuation metrics are as follows: P/E Ratio at 14.85, P/B Ratio at 1.67, P/S Ratio at 0.81, EV/EBITDA at 10.93, Dividend Yield at 2.38%, Free Cash Flow Yield at 6.14%, ROIC at 7.74%, and ROE at 10.98%. The stock's P/E Ratio suggests that the market is pricing in moderate growth expectations. With the company's efforts to revitalize the Columbia brand through the ACCELERATE Growth Strategy and the successful launch of new products, the stock may be poised for growth.

Tariff Impact and Mitigation

The company has navigated tariff environments successfully in the past and has a large team dedicated to making products in locations with favorable duty conditions. Jim Swanson mentioned that the company has discussed mitigation factors with strategic factory partners, and there will be instances where production will be resourced successfully, which will help mitigate the cost of the incremental tariffs.

3. NewsRoom

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Columbia Sportswear Unveils The Endor™ Collection - Inspired by Star Wars: Return of the Jedi™

Dec -03

Source: businesswire.com

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Columbia Sportswear CEO on tariff impact: We'll raise prices when our current inventory is depleted

Nov -28

Source: youtube.com

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Columbia Sportswear Company (NASDAQ:COLM) Given Consensus Recommendation of “Hold” by Brokerages

Nov -25

Source: defenseworld.net

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4 Cold-Weather Stocks to Buy as Winter Spending Heats Up

Nov -16

Source: marketbeat.com

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Bank of New York Mellon Corp Acquires 3,331 Shares of Columbia Sportswear Company $COLM

Nov -16

Source: defenseworld.net

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Quantedge Capital Unloads All Columbia Sportswear Shares Worth $7.4 Million

Nov -14

Source: fool.com

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The Cities That Give You the Best Shot at a $100K Salary—And Where Your Money Will Go the Furthest

Nov -13

Source: investopedia.com

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Columbia Sportswear Company Advances Its Succession Plans and Appoints Co-Presidents, Peter J. Bragdon and Joseph P.

Nov -12

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.00%)

6. Segments

Apparel, Accessories and Equipment

Expected Growth: 4%

Columbia Sportswear's 4% growth in Apparel, Accessories, and Equipment is driven by increasing outdoor recreation participation, innovative product lines, and strategic marketing campaigns. Expansion into new markets, particularly in Asia, and e-commerce growth also contribute to the segment's growth. Furthermore, the company's focus on sustainability and digital transformation enhances its brand appeal, attracting environmentally conscious and tech-savvy consumers.

Footwear

Expected Growth: 4%

Columbia Sportswear's 4% growth in footwear is driven by increasing outdoor participation, innovative product lines, and strategic marketing efforts. The company's focus on comfort, sustainability, and performance resonates with consumers. Expansion into new markets, such as Asia, and e-commerce growth also contribute to the segment's growth.

7. Detailed Products

Outerwear

Waterproof and breathable jackets, pants, and vests designed for outdoor enthusiasts

Fleece

Soft, warm, and lightweight fleece jackets, pullovers, and hoodies for casual wear

Shirts

Moisture-wicking, breathable, and quick-drying shirts for outdoor activities

Pants and Shorts

Water-resistant, breathable, and comfortable pants and shorts for outdoor activities

Footwear

Waterproof, breathable, and comfortable hiking boots, trail running shoes, and sandals

Accessories

Hats, gloves, scarves, and other accessories designed for outdoor enthusiasts

Sleeping Bags and Pads

Warm, lightweight, and compact sleeping bags and sleeping pads for camping

8. Columbia Sportswear Company's Porter Forces

Forces Ranking

Threat Of Substitutes

Columbia Sportswear Company faces moderate threat from substitutes, as consumers have alternative options for outdoor apparel and footwear from other brands.

Bargaining Power Of Customers

Columbia Sportswear Company has a diverse customer base, which reduces the bargaining power of individual customers, making it a low threat.

Bargaining Power Of Suppliers

Columbia Sportswear Company relies on a few large suppliers for raw materials, which gives them some bargaining power, making it a moderate threat.

Threat Of New Entrants

The outdoor apparel and footwear industry has high barriers to entry, making it difficult for new entrants to compete with established brands like Columbia Sportswear Company, making it a low threat.

Intensity Of Rivalry

The outdoor apparel and footwear industry is highly competitive, with many established brands competing for market share, making it a high threat for Columbia Sportswear Company.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 17.38%
Debt Cost 3.95%
Equity Weight 82.62%
Equity Cost 8.66%
WACC 7.84%
Leverage 21.04%

11. Quality Control: Columbia Sportswear Company passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

55.11$

Current Price

55.11$

Potential

-0.00%

Expected Cash-Flows