Baird stepped to the sidelines on both Canada Goose (NYSE:GOOS) and VF Corp. (NYSE:VFC) on Tuesday, citing over-optimism among respective investor bases.

Equity analyst Jonathan Komp suggested that year-to-date strength for both apparel manufacturers as indicative of growing confidence in a soft landing in 2023 and margin recovery for retailers. Komp took a more cautious tack, advising that earnings may come up short of rosier expectations now growing in popularity.

In particular, Komp expects that the tailwinds from China’s reopening are being overestimated in the case of Canada Goose (GOOS) given an over 40% jump for the stock since November. He cut his rating to Neutral as a result of his more skeptical view of the boost provided by the region.

“Despite the potential positive developments with GOOS’ investor day, we think the full benefits from a China recovery could take 9+ months for the company to realize given typical seasonality, and in the interim we see potential risk to any slowdown in global consumer spending during GOOS’ typically lower-volume seasonal months,” Komp concluded.

VF Corporation (VFC) was also cut to Neutral given a number of overhangs on the stock, including earnings revisions, elevated inventory levels, and a CEO transition.

Shares of VF Corporation (VFC) and Canada Goose (GOOS) slipped 1.64% and 2.09% in premarket trading on Tuesday, respectively.

Read more on the recent analyst concerns regarding VF Corp.’s CEO search.