Some investors want quick wins. Others want a stock they can hold forever. Personally, I lean hard toward the second camp. And if there’s one Canadian stock I’m more confident in than ever, it’s Aritzia (TSX:ATZ).
Yes, the fashion retailer — the one your kids shop at. But this is no passing trend; it’s a well-oiled machine with a strategic plan, growing international presence, and the kind of earnings that make long-term investors grin. Let’s break it down.
Into earnings
Aritzia just posted a blockbuster quarter. In the first quarter (Q1) of 2026, net revenue surged 33% year over year to $663 million. But that’s just the beginning. Its U.S. segment, now over 62% of total sales, grew a jaw-dropping 45%, driven by a potent mix of new store openings and soaring online demand. Comparable sales grew 19%, and growth wasn’t isolated to one channel or region. Retail was up 34%, e-commerce rose 30%, and Canada still pulled its weight with 17% revenue growth.
Gross profit jumped 42.5% to $312.8 million, and margins expanded by 320 basis points to 47.2%. That’s no small feat in a cost-conscious consumer environment. CEO Jennifer Wong summed it up well: “The strength of the Aritzia brand has never been greater, and yet we still have a long runway for growth in the United States.”
Even more compelling is that Aritzia is expanding while getting leaner. Selling, general, and administrative (SG&A) expenses dropped as a percentage of revenue, falling from 35.4% to 33.5%. Meanwhile, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) climbed 76.9% to $95.3 million, and adjusted net income nearly doubled. In fact, adjusted earnings per share (EPS) came in at $0.42, up 91% from $0.22 a year ago.
More to come
This isn’t a fluke. Aritzia’s strategic plan has been years in the making. The Canadian stock is focused on expanding into the U.S., with 11 new boutiques and two re-positionings planned in that market this year alone. And it’s not just about stores. Aritzia is investing in a new distribution centre in British Columbia and doubling down on digital marketing and e-commerce capabilities.
Its balance sheet also looks sharp. Aritzia ended Q1 with nearly $293 million in cash and equivalents, up nearly 200% from a year ago, and posted $24 million in free cash flow. It also repurchased shares during the quarter under its buyback program. For long-term investors, that signals confidence from management and a focus on shareholder value.
Of course, no company is invincible. Aritzia does face risks. Tariffs in the U.S. could inflate costs, currency swings can impact margins, and a softening economy might slow spending on discretionary goods like luxury fashion. But so far, Aritzia has proven nimble. It’s managed through shifting FX rates, optimized inventory, and maintained pricing power even as others in the space discount heavily.
Looking ahead
And the future looks bright. Management is forecasting revenue between $3.10 and $3.25 billion for fiscal 2026, representing 13% to 19% growth. That’s on top of the 33% leap we just saw. Gross margin is also expected to improve, and EBITDA margins are on track to expand by up to 170 basis points.
What makes this Canadian stock a forever pick for me isn’t just the numbers. It’s the brand. Aritzia isn’t chasing fads. It’s focused on “Everyday Luxury,” with curated labels and quality construction that resonate deeply with its core customers. It’s one of the few Canadian brands that has found a loyal following in the U.S., a notoriously hard market to crack. And it’s doing so without compromising its style or pricing integrity.
In a market where many retailers are struggling to stay relevant, Aritzia is building something durable. The boutiques are beautiful, the website is smooth, and the product mix feels timeless rather than trendy. The proof is in the results, and the results are spectacular.
Bottom line
So, yes, Aritzia doesn’t pay a dividend. But that’s fine by me. I’d rather it reinvest its cash in long-term growth, something it’s clearly doing with precision. As it continues to scale, expand margins, and deepen its U.S. presence, I see years of compounding ahead.
