Yahoo Finance Why Canada Goose Stock Dropped 33.2% in December
What happened
Shares of Canada Goose Holdings (NYSE: GOOS) fell 33.2% in December, according to data from S&P Global Market Intelligence, amid concerns over calls to boycott the winter clothing brand in China over the Dec. 1, 2018, arrest of Huawei CFO Meng Wanzhou in Ottawa.
Investors should keep in mind the broader stock market also plunged last month, with the S&P 500 declining 9% on worries surrounding the U.S.-China trade war and slowing global economic growth. But with Canada Goose stock already having more than doubled through the first 11 months of 2018, it was likely ripe for a correction on any hint of uncertainty.
IMAGE SOURCE: GETTY IMAGES.
So what
The first report of an apparent boycott of Canadian brands came from Chinese state media sites shortly after the arrest. Canada Goose, in particular, was singled out in those reports as a primary subject of Chinese consumers' ire -- though other reputable global media outlets questioned whether the boycott was as dramatic as those reports initially made it seem.
It also didn't help when Canada Goose appeared to acknowledge the strife by delaying the opening of its first brick-and-mortar store in China around the middle of last month.
Now what
To be fair, that location reportedly attracted large crowds when it did finally open its doors in Beijing toward the end of December, lending credence to the skeptics of Canada Goose's demise.
As it stands, we should receive some fresh color on any hiccups in Canada Goose's China growth plans when the company reports quarterly results in early February. Barring any preliminary updates between now and then, I suspect the stock will remain at the mercy of continued political unrest (or lack thereof) and the broader market's swings.
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Steve Symington has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
