COLUMBIA SPORTSWEAR COMPANY (COLM): what the price assumes

In the published model solve dated 2026-Q2, anchored at $58.01, COLUMBIA SPORTSWEAR COMPANY (COLM) is priced for -4.1% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-08-30 · Source: https://boothcheck.com/report/COLM

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 9.3% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

The price is supported by asset-based and earnings-power and relative-multiple and growth-DCF value. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Asset, Earnings, Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.9%); the inversion above states its own rate.

Per-Model Detail (n=18)

Solvency

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

• At roughly 10x mid-cycle operating income, the market is underwriting company-wide operating profit that shrinks rather than grows over the next five years, which is an unusual thing to pay for a brand with no funded debt.
• Growth has moved offshore: the 10-K reports EMEA segment operating income rising to $121.4 million, or 21.0% of net sales, in 2025 from $103.5 million a year earlier, while the first quarter of 2026 showed underlying weakness in the U.S., primarily in the Columbia and SOREL brands across channels.
• Apparel, accessories and equipment supplies four fifths of revenue and footwear the rest, so the SOREL and Columbia footwear franchises are the swing factor rather than the core; second-quarter results land July 30, 2026.

Bull Case

The strangest number in this company's file is not a margin or a growth rate. It is what the price assumes. At roughly 10x mid-cycle operating income, today's quote embeds company-wide operating profit declining at about -3.9% a year for the next five years. Not decelerating growth. Decline, held steady, for half a decade. That is what you are being asked to pay for, and it is worth sitting with before looking at anything else.

Because what the business actually did last year does not look like the beginning of a five-year contraction. The 10-K shows operating income of $310.3 million for 2025, with interest income of $13.7 million on top of it and $2.2 million of other non-operating income, for income before tax of $326.2 million. Outside the United States the trend was better still. EMEA segment operating income increased $17.9 million to $121.4 million, or 21.0% of net sales, up from 20.2% the year before, and LAAP net sales increased $50.4 million, or 9% on a constant-currency basis of 10%. Two of the four regions are compounding.

The balance sheet is the part of this that most companies cannot copy. Columbia carries no funded debt at all, against $535.4 million of net cash on that funded-debt basis. There is no refinancing calendar, no covenant, no interest bill competing with the marketing budget. In a category where the losers are usually killed by carrying inventory they financed, that is a structural advantage rather than a conservative posture.

And the cash has been going back to owners. The share count has fallen about 5% a year over the last four years, which is a company retiring roughly a twentieth of itself annually while the market prices its profits to shrink. Management's own record with expectations is unusually clean too: since 2007 they have raised guidance on 23 separate occasions and cut it once. That is not a team in the habit of promising more than the season delivers.

Put those together and the bull case is arithmetic rather than a story. Through the cycle, this business has run an operating margin around 10.7%. Pay roughly 10x that level of profit for a debt-free company shrinking its own share count, and you do not need the brand to become something it isn't. You need it to be roughly what it has already been.

Bear Case

Look at who Columbia is standing next to in the outdoor and technical apparel aisle. Lululemon (LULU) turns $11.2 billion of revenue at an 18.3% operating margin, with gross margin at 55.7%. Levi Strauss (LEVI) holds a 61.7% gross margin on $6.6 billion of sales. FIGS, a far smaller company, runs a 66.6% gross margin and grew 18.7%. These are brands that set their own price. And the counterexample is right there too: Under Armour (UAA), a technical-apparel brand that lost pricing power, is now running a negative operating margin on revenue that fell 3.8%. The gap between those two outcomes is not about product quality. It is about whether a consumer will pay full price without a promotion, and that is exactly what is being contested in Columbia's home market.

The filings say where the pressure is landing. In the first quarter of 2026, international results were offset by underlying weakness in the U.S., primarily in the Columbia and SOREL brands across channels, and reported net sales carried a favorable 280 basis point impact from foreign currency translation. Strip out the currency tailwind and the domestic core is going backwards while the reported line looks steadier than the business underneath it.

The wholesale structure amplifies whatever the consumer decides. Columbia sells a large share of its product to retailers and independent distributors months before the selling season, and the 10-K is clear that the distributors are not otherwise obligated to purchase products from us. When demand softens, that shows up as orders that never arrive. It has already happened: the risk factors describe our cancellation of product orders in advance of the Fall 2025 and Spring 2026 seasons. A brand that cancels its own orders two seasons running is telling you something about what it expects at retail.

Which brings the valuation into focus, and here the methods split hard. Only the peer-multiple methods reach today's price. The asset-value methods land about 67% below it, and the earnings-power methods, which capitalize what the company is currently earning rather than what it earns in a good year, land roughly 120% below. That spread is not noise. It is the entire bear case in one line: the stock looks inexpensive only if you value it on through-cycle profitability, and looks expensive if you value it on what it is generating right now.

So the bear thesis is not that Columbia is fragile. With no funded debt it plainly is not. The thesis is that the through-cycle margin of about 10.7% is a historical artifact of a period when the U.S. outdoor consumer paid full price for a rain shell, and that the current period, with a weakening domestic core, cancelled seasonal orders and competitors who defend price better, is the new normal rather than the trough. If that is right, the price is not paying 10x a normal year. It is paying considerably more than that for a diminished one.

Valuation

Start with what the price assumes rather than what it is. Today's $62.29 works out to roughly 10x mid-cycle operating income, and inverting it gives company-wide operating growth of about -3.9% a year over a five-year run. The word mid-cycle is doing real work in that sentence: the calculation deliberately uses the company's own through-the-cycle margin, around 10.7%, rather than the trailing period, because a trough quarter in seasonal apparel makes any multiple look absurd. On that basis, the market is not paying for expansion. It is paying for managed decline.

How unusual is a bet like that? Not very, which is the point. Against Columbia's own record the near-term pace sits inside what the company has recently delivered, and the demanding part is duration rather than rate. Against the peer group, the multiple sits in the lower half of the range. The overall assumption reads as broadly consistent with plausible outcomes, which for a valuation section is a quieter conclusion than usual and an honest one.

The methods themselves disagree about which earnings to capitalize. Only the peer-multiple methods reach the price. The asset-value methods land about 67% under it, the earnings-power methods about 120% under, and the growth-based methods about 27% under. Read the pattern rather than the individual numbers: every lens anchored on current profitability puts the business below today's quote, and only the lens that compares Columbia to what other apparel companies fetch supports it. That is a company being valued on its category rather than on its present cash generation, and it is the reason the mid-cycle-versus-current question is not academic here.

Peer context sharpens the same point. Carter's (CRI) runs a 5.0% operating margin, G-III (GIII) 6.4%, Gap (GAP) 8.4%, and Lululemon (LULU) 18.3%. Columbia's through-cycle level sits in the upper half of that spread and its current level does not, so where an investor places it in that range is effectively the whole valuation debate.

The balance sheet takes the tail risk out of getting that debate wrong. There is no funded debt, and net cash on that funded-debt basis is $535.4 million. Set against a market value in the low three billions, that covers roughly a sixth of what the equity costs before the business earns anything. Interest expense is not a line that matters here. Meanwhile the share count has fallen about 5% a year for four years, which means the per-share claim on whatever the business does earn keeps rising without the business having to grow at all.

Catalysts

Second-quarter results arrive on July 30, 2026, a date the company confirmed on July 16. It is the first full look at the domestic business since the first quarter, when net sales and profitability came in ahead of the company's own guidance on international strength offsetting U.S. declines. Given that the price already embeds a shrinking profit stream, the useful thing to watch is not whether the quarter beats but whether the U.S. line stops getting worse.

Management has been reshuffling brand leadership around exactly that problem. Joe Vernachio was named president of SOREL in June 2026. SOREL sits inside the footwear side of the business, which supplies about a fifth of revenue, and it is one of the two brands the first-quarter filing singled out for domestic softness. A new brand president will not change a season already bought, but footwear is where the incremental margin dollars in this company have historically been won or lost.

The sell side has barely moved. Citi lifted its target to $68 from $67 on July 24 while keeping a neutral rating, a one-dollar adjustment that says the street is waiting rather than repositioning. The dividend, meanwhile, is $1.20 a share annually and went ex on May 21, 2026, a yield near two percent that is a byproduct of the capital return rather than its main channel; the buyback is doing most of that work.

Peer Cohorts (Per Segment, With Filing Citations)

LAAP (reported)

• AS (Amer Sports, Inc.)
• FY2025 20-F: …Salomon branded products in Malaysia, Philippines, Singapore, Indonesia, Thailand, Vietnam, India, Sri Lanka, Cambodia, Brunei, Nepal, Bangladesh, Laos, Myanmar and Maldives and (2) agrees not promote, sell or offer for sale any goods that compete with such products without Amer Sports Malaysia's written consent,…
• FY2025 20-F: …operations and financial condition. Various jurisdictions where we import or sell our products have imposed restrictions on, or additional requirements for, products based on their provenance or the origins of certain of their component parts. For example, in December 2021, the U.S. Congress passed the Uyghur Forced…
• UAA (UNDER ARMOUR, INC.)
• FY2025 10-K: 001336917 us-gaap:LandMember 2025-03-31 0001336917 us-gaap:LandMember 2024-03-31 0001336917 us-gaap:ConstructionInProgressMember 2025-03-31 0001336917 us-gaap:ConstructionInProgressMember 2024-03-31 0001336917 us-gaap:OtherCapitalizedPropertyPlantAndEquipmentMember 2025-03-31 0001336917…
• FY2025 10-K: 001336917 ua:EmployeeStockPurchasePlanMember us-gaap:CommonClassCMember 2023-04-01 2024-03-31 0001336917 ua:EmployeeStockPurchasePlanMember us-gaap:CommonClassCMember 2022-04-01 2023-03-31 0001336917 ua:MarketingAndConsultingPartnersMember 2024-04-01 2025-03-31 0001336917 ua:MarketingAndConsultingPartnersMember…
• LULU (lululemon athletica inc.)
• FY2025 10-K: …more detail on the GAAP financial measure that is most directly comparable to each non-GAAP financial measure, and the related reconciliations between these financial measures. Our non-GAAP financial measures may be calculated differently from, and therefore may not be directly comparable to, similarly titled…
• FY2025 10-K: …us-gaap:CashAndCashEquivalentsMember 2024-01-28 0001397187 us-gaap:MoneyMarketFundsMember us-gaap:FairValueInputsLevel3Member us-gaap:CashAndCashEquivalentsMember 2024-01-28 0001397187 us-gaap:BankTimeDepositsMember us-gaap:CashAndCashEquivalentsMember 2024-01-28 0001397187 us-gaap:BankTimeDepositsMember…
• LEVI (LEVI STRAUSS & CO)
• FY2025 10-K: …lvis:A3.375SeniorNotesDue2027Member us-gaap:SeniorNotesMember 2025-11-30 0000094845 us-gaap:CarryingReportedAmountFairValueDisclosureMember us-gaap:FairValueMeasurementsRecurringMember lvis:A3.375SeniorNotesDue2027Member us-gaap:SeniorNotesMember 2024-12-01 0000094845…
• FY2025 10-K: …us-gaap:LineOfCreditMember 2024-12-02 2025-11-30 0000094845 us-gaap:RevolvingCreditFacilityMember lvis:CreditAgreementMember us-gaap:SecuredDebtMember 2025-11-30 0000094845 us-gaap:RevolvingCreditFacilityMember lvis:CreditAgreementMember us-gaap:SecuredDebtMember 2024-12-02 2025-11-30 0000094845…
• CRI (Carter's, Inc.)
• FY2025 10-K: …donations and consulting costs, partially offset by higher severance and recruiting costs and increased performance-based compensation expense. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP MEASURES We have provided non-GAAP adjusted operating income, income taxes, net income, and diluted net income per…
• FY2025 10-K: …styling, updated packaging and presentation strategies, and consumer-facing marketing. We also place importance on differentiating our brand experience through in-store fixturing, branding, signage, photography, and advertising across all of our global channels of distribution. Licensed Products We license our…
• GIII (G III APPAREL GROUP LTD /DE/)
• FY2025 10-K: …represents advance payments to licensors for minimum guaranteed payments for advertising under the Company's licensing agreements, was $ 3.6 million and $ 7.3 million at January 31, 2025 and 2024, respectively. ​ 16. Use of Estimates ​ In preparing financial statements in conformity with accounting principles…
• FY2025 10-K: …2022-02-01 2022-05-30 0000821002 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-02-01 2025-01-31 0000821002 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-02-01 2024-01-31 0000821002 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2022-02-01 2023-01-31 0000821002 us-gaap:PerformanceSharesMember…
• FIGS (FIGS, Inc.)
• FY2025 10-K: …our data-driven brand and performance marketing efforts. See the section titled "Key Operating Metrics and Non-GAAP Financial Measures" for a definition of active customers. In the year ended December 31, 2025, we had the following results compared to the comparable periods in 2024: ◦ Expanded our community of active…
• FY2025 10-K: …in a decline in the trading price of our Class A common stock. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in our financial statements and accompanying notes. We base our estimates on historical experience and…
• GAP (GAP, INC)
• FY2025 10-K: …returns by comparing prior period estimates to actual merchandise returns • We developed an independent estimate of sales return allowances and the right of returns asset and compared it to the recorded amount. /s/ Deloitte & Touche LLP San Francisco, California March 18, 2025 We have served as the Company's auditor…
• FY2025 10-K: . THE GAP, INC. Date: March 18, 2025 By /s/ RICHARD DICKSON Richard Dickson President, Chief Executive Officer, and Director (Principal Executive Officer) Date: March 18, 2025 By /s/ KATRINA O'CONNELL Katrina O'Connell Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.