Aritzia Inc T.ATZ

Alternate Symbol(s): ATZAF

Consumer Cyclical

Aritzia Inc. is a Canada-based vertically integrated design house. The Company is the creator and purveyor of Everyday Luxury, home to a portfolio of brands for every function and individual aesthetic. The Company provides personal shopping experiences at aritzia.com and in its 115+ boutiques throughout North America. The Company’s product categories include activewear, blazers and suiting, bodysuits, denim, dresses, intimates and shapewear, jackets and coats, jumpsuits and rompers, leggings and bike shorts, pants and accessories. The Company offers its products under various brands, including Babaton, Denim Forum, Golden, Little Moon, Sunday Best, Ten, The Group by Babaton, Tna, Wilfred, Wilfred Free, Contour, Seamless, Sweatfleece, The Effortless Pant, The Super Puff and others. Its distribution network consists of three distribution centers, two in Canada and one in the United States, that are positioned to service its boutiques and e-commerce business.

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Aritzia Inc

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Post by retiredcfon Oct 28, 2022 8:35am

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Post# 35055308

TD 2

Aritzia Inc.

(ATZ-T) C$51.72

Investor Day Highlights; Enhancing Proven Growth Pillars Event

Yesterday, Aritzia ("ATZ") hosted its first investor day at its Vancouver support office. The presentations outlined ATZ's "Powering Strong" strategic growth plan, key initiatives, and long-term financial outlook.

Impact: POSITIVE

Key Takeaways: From our perspective, yesterday's presentations highlighted ATZ's key strengths that have supported its success to-date, and should continue to drive the business going forward. Despite the many available growth opportunities for ATZ, management conveyed a sense of discipline that underscores its strategic initiatives through F2027.
Proven Strategic Levers: From a geographic standpoint, the U.S. remains at the center of ATZ's growth strategy. As it enters new U.S. markets, this should in turn contribute to the expansion of its eCommerce business. Within its digital channels, ATZ will focus on enhancing its Everyday Luxury experience through initiatives such as personalization. These levers should be complemented by an organic approach to driving brand awareness that leverages ATZ's attractive real- estate portfolio, its expanded client base, and social communities.
Assessing the Long-term Financial Targets: In our view, there were no major surprises within the financial outlook through F2027. We see these targets as achievable, with potential room for upside. We believe there is a degree of conservatism factored into management's top-line outlook when considering the rapid payback of its new stores and the expected growth in its client base. The outlook does reflect continued investments in growth (people, marketing, and DC expansion) that may have deterred investors to a degree. As such investments have fuelled ATZ's recent success, we see these as justified.

TD Investment Conclusion

We are maintaining our BUY recommendation and $62.00 target price. ATZ's investor day underscored management's disciplined approach to growth. Admittedly, we were hoping for incremental details around international growth and the expansion of men's. Following the presentations/outlook, we have come to further appreciate the attractive runway within ATZ's proven growth verticals, including the U.S. and eCommerce.