Will Aritzia beat the street?

Desjardins Securities analyst Chris Li said he expects another “beat and raise” from Aritzia (Aritzia Stock Quote, Chart, News, Analysts, Financials TSX:ATZ) when the company reports third-quarter fiscal 2026 results after market close on Thursday.

As reported by the Globe and Mail, Li is forecasting revenue growth of 31%, well above management’s 20%–24% guidance, driven by a strong product assortment, optimized inventory, stepped-up marketing, outsized e-commerce growth and continued new store openings.

In a client note, Li raised his earnings forecast to 91 cents per share, three cents above Street consensus, citing robust Bloomberg ALTD data and his own channel checks. He said sales strength continues to be supported by improved inventory positioning and marketing, while the mobile app launch in late October should further boost e-commerce results.

Li is forecasting comparable sales growth of 22%, or 29% on a two-year stacked basis, with the balance of growth coming from new stores.

Despite incremental pressure from tariffs and the elimination of the de minimis exemption, Li expects gross margin expansion of 60 basis points year over year, supported by strong sales leverage and improved initial markups. He also forecasts 30 basis points of SG&A leverage, ahead of management’s flat guidance, as revenue growth more than offsets ongoing investments.

Given the strong third-quarter outlook and momentum expected to carry into the fourth quarter, Li believes management will raise full-year fiscal 2026 guidance. He and consensus are forecasting revenue of $3.4-billion, above the company’s $3.30-billion to $3.35-billion range, along with an EBITDA margin of 16.4%.

Reflecting higher revenue and earnings forecasts through fiscal 2027 and rolling his valuation forward to 2028, Li raised his target price to $133 from $125 and reiterated a “Buy” rating. He said Aritzia remains a compelling investment, supported by industry growth, U.S.-focused store expansion and repositioning, accelerating e-commerce and a management team now positioned to leverage a largely completed investment cycle.

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