On Holding AG: Strong Growth Potential Amidst Challenges and Strategic Expansion

William Blair analyst Dylan Carden has maintained their bullish stance on ONON stock, giving a Buy rating today.

Dylan Carden has given his Buy rating due to a combination of factors that highlight On Holding AG’s strong performance and potential for continued growth. The company reported impressive results for the first quarter, surpassing expectations in both revenue and adjusted EBITDA, despite facing challenges such as higher SG&A costs and foreign exchange impacts. Management’s decision to modestly raise revenue guidance for the full year, despite lowering total sales expectations due to currency fluctuations, indicates confidence in the company’s underlying growth trajectory.
Carden’s analysis emphasizes the significant role of new product launches and the traction gained in the apparel segment as key drivers of On Holding AG’s growth. The company’s ability to innovate and expand its product offerings positions it well within the competitive athletic footwear market, particularly as it capitalizes on opportunities left by competitors like Nike. While acknowledging the challenges posed by tariffs and currency volatility, Carden believes that the company’s focus on direct expansion and its strong momentum, particularly with new launches, will enable it to achieve sustained growth above 20% in the coming years.

According to TipRanks, Carden is a 5-star analyst with an average return of 21.5% and a 65.75% success rate. Carden covers the Consumer Cyclical sector, focusing on stocks such as thredUP, On Holding AG, and National Vision Holdings.

In another report released today, Needham also maintained a Buy rating on the stock with a $62.00 price target.