Adidas (ADDYY) AI Stock Analysis

Compare

1,542 Followers

Top Page

Adidas

(OTC:ADDYY)

Rating:66Neutral

Price Target:

$105.00

▲(6.04% Upside)

Adidas's overall stock score is driven by strong financial performance and positive earnings call sentiment, highlighting robust revenue growth and operational efficiency. However, technical indicators suggest bearish momentum, and valuation metrics indicate potential overvaluation. Challenges such as US tariffs and e-commerce downturns also pose risks.

Adidas (ADDYY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$34.87B

Dividend Yield1.29%

Average Volume (3M)10.22K

Price to Earnings (P/E)26.6

Beta (1Y)0.76

Revenue Growth11.60%

EPS Growth399.24%

CountryUS

Employees46,045

SectorConsumer Cyclical

Sector Strength79

IndustryApparel - Footwear & Accessories

Share Statistics

EPS (TTM)1.17

Shares Outstanding360,000,000

10 Day Avg. Volume8,085

30 Day Avg. Volume10,224

Financial Highlights & Ratios

PEG Ratio-0.05

Price to Book (P/B)7.67

Price to Sales (P/S)1.77

P/FCF Ratio17.72

Enterprise Value/Market Cap1.36

Enterprise Value/Revenue1.94

Enterprise Value/Gross Profit3.78

Enterprise Value/Ebitda15.88

Forecast

1Y Price Target

$131.75

Price Target Upside33.05% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering3

Adidas Business Overview & Revenue Model

Company Descriptionadidas AG, together with its subsidiaries, designs, develops, distributes, and markets athletic and sports lifestyle products worldwide. It offers footwear; apparel; and accessories and gear, such as bags and balls under the adidas brand. It sells its products through approximately 2,200 own-retail stores; mono-branded franchise stores and shop-in-shops; and wholesale and its e-commerce channels. The company was formerly known as adidas-Salomon AG and changed its name to adidas AG in June 2006. adidas AG was founded in 1920 and is headquartered in Herzogenaurach, Germany.

How the Company Makes MoneyAdidas generates revenue through several key streams, primarily from the sale of its footwear, apparel, and accessories. The company operates a mix of wholesale and direct-to-consumer channels, with a significant portion of its earnings coming from selling products through its own retail stores and e-commerce platforms. Additionally, partnerships with professional sports teams, athletes, and influencers enhance brand visibility and drive sales. The company also benefits from licensing agreements, allowing it to earn revenue through the manufacturing and sale of branded products by third-party companies. Seasonal product launches and limited-edition collaborations create hype and exclusivity, contributing to increased sales. Furthermore, Adidas invests in sustainability initiatives, which appeal to environmentally conscious consumers, potentially boosting its market share and profitability.

Adidas Earnings Call Summary

Earnings Call Date:Jul 30, 2025

(Q1-2025)

% Change Since: |

Next Earnings Date:Oct 29, 2025

Earnings Call Sentiment Positive

Adidas reported a strong financial performance for Q1 2025, with significant sales growth and improved profitability. The company achieved notable successes in product launches and regional market growth, particularly in emerging markets and Latin America. However, uncertainty surrounding U.S. tariffs poses a potential challenge to maintaining margins, and the decrease in e-commerce sales highlights the impact of lost YEEZY sales. Overall, the positive highlights significantly outweigh the lowlights, indicating a robust start to the fiscal year.

Q1-2025 Updates

Positive Updates

Strong Q1 2025 Financial Performance

Adidas reported a currency-neutral net sales increase of 13%, with the Adidas brand specifically seeing a 17% increase when excluding YEEZY. Gross profit margins improved by 90 basis points to over 52%. Operating profit (EBIT) reached €610 million, a nearly 400 basis point improvement, translating to a 9.9% operating margin.

Regional Growth Success

All markets showed growth, with North America up 13% for the Adidas brand, Europe up 16%, Greater China up 14%, and Latin America up 27%. Emerging markets also grew by 25%.

Apparel and Footwear Performance

Footwear sales grew by 17%, apparel approached double-digit growth, and accessories increased by 10%. The division is seeing increased consumer demand, particularly in lifestyle and performance categories.

Successful Product Launches and Brand Heat

Adidas experienced strong consumer demand for new products, including collaborations and limited editions. The brand's visibility in sports and lifestyle markets has increased, contributing to a successful quarter.

Negative Updates

U.S. Tariff Challenges

Adidas faces uncertainty from U.S. tariffs, which have been increased and could impact margins. The company is monitoring the situation and may need to adjust pricing strategies.

E-commerce Decrease

E-commerce sales decreased by 3% overall, although they rose by 18% when excluding YEEZY. The decline is attributed to the absence of €150 million in YEEZY sales from the previous year.

Company Guidance

In the adidas AG Q1 2025 Conference Call, the company reported strong financial metrics, highlighted by a 13% increase in net sales currency-neutral, and a noteworthy 17% growth excluding YEEZY. The gross profit margin improved over 52%, with the adidas brand showing a 160 basis point increase. Operating profit reached €610 million, nearly a 10% EBIT margin, reflecting a 400 basis point enhancement. The call emphasized regional growth, with Europe and Greater China up 16% and 14% respectively, while Latin America surged by 27%. North America saw a 13% rise in the adidas brand despite the absence of YEEZY sales. The company also spotlighted its strategic focus on local market execution, performance in key categories, and the ongoing impact of U.S. tariffs, maintaining its full-year guidance despite these challenges.

Adidas Financial Statement Overview

Summary

Adidas demonstrates a strong financial recovery with improved profitability margins and robust cash flow management. The company effectively manages debt while maintaining a balanced financial structure. However, there is a need to sustain cash flow momentum and strengthen its equity position for long-term health.

Income Statement

Very Positive

Adidas has demonstrated strong revenue growth of 13.75% from 2023 to TTM (Trailing-Twelve-Months) and a net profit margin improvement to 4.19% in TTM, indicating enhanced profitability. The gross profit margin remained robust at 51.0% in TTM, highlighting effective cost management. The EBIT margin of 6.61% and EBITDA margin of 11.51% in TTM further confirm operational efficiency. However, the company faced a challenging period in 2023 with a negative net income, but has since recovered well.

Balance Sheet

Positive

Adidas maintains a moderate debt-to-equity ratio of 0.97 in TTM, reflecting a balanced approach to leverage. The equity ratio stands at 28.44%, indicating a stable financial structure. Return on equity improved significantly to 17.89% in TTM, showcasing enhanced shareholder returns. Despite these strengths, there is room for improvement in equity growth and further reduction of liabilities to enhance financial stability.

Cash Flow

Positive

Adidas exhibits strong cash flow management with a free cash flow to net income ratio of 1.52 in TTM, demonstrating efficient conversion of earnings into cash. The operating cash flow to net income ratio of 2.05 in TTM further underlines robust cash generation capacity. However, the free cash flow decreased by 34.36% compared to the previous year, suggesting potential challenges in sustaining cash flow momentum.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	24.51B	23.68B	21.43B	22.51B	21.23B	19.84B
Gross Profit	12.55B	12.03B	10.18B	10.64B	10.77B	9.85B
EBITDA	2.99B	2.51B	785.00M	1.75B	3.11B	1.98B
Net Income	1.20B	764.00M	-75.00M	254.00M	1.49B	432.00M
Balance Sheet
Total Assets	19.50B	20.66B	18.02B	20.30B	22.14B	21.05B
Cash, Cash Equivalents and Short-Term Investments	1.43B	2.48B	1.48B	966.00M	3.94B	4.24B
Total Debt	5.47B	5.59B	5.56B	6.46B	5.33B	5.89B
Total Liabilities	13.94B	14.79B	13.10B	14.95B	14.30B	14.36B
Stockholders Equity	5.20B	5.48B	4.58B	4.99B	7.52B	6.45B
Cash Flow
Free Cash Flow	692.00M	2.37B	2.13B	-1.24B	2.52B	1.04B
Operating Cash Flow	1.23B	2.91B	2.55B	-543.00M	3.19B	1.49B
Investing Cash Flow	-342.00M	-356.00M	-450.00M	495.00M	-424.00M	-115.00M
Financing Cash Flow	-1.71B	-1.56B	-1.43B	-2.96B	-2.99B	479.00M

Adidas Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price99.02

Price Trends

50DMA

109.27

Negative

100DMA

113.69

Negative

200DMA

118.59

Negative

Market Momentum

MACD

-3.00

Negative

RSI

41.47

Neutral

STOCH

26.82

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ADDYY, the sentiment is Neutral. The current price of 99.02 is above the 20-day moving average (MA) of 97.57, below the 50-day MA of 109.27, and below the 200-day MA of 118.59, indicating a neutral trend. The MACD of -3.00 indicates Negative momentum. The RSI at 41.47 is Neutral, neither overbought nor oversold. The STOCH value of 26.82 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ADDYY.

Adidas Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DECK	83 Outperform	$16.87B	17.93	43.58%	―	15.43%	24.20%
SKX	77 Outperform	$9.47B	14.42	14.79%	―	12.11%	17.08%
NKE	74 Outperform	$116.16B	36.35	23.29%	2.01%	-9.70%	-42.38%
BIRK	72 Outperform	$9.54B	29.02	11.36%	―	18.66%	183.98%
CROX	68 Neutral	$4.67B	23.26	15.39%	―	2.04%	-71.52%
ADDYY	66 Neutral	$34.87B	26.55	22.73%	1.29%	11.60%	399.24%
Sector *	61 Neutral	$17.78B	13.97	-5.49%	3.03%	1.50%	-15.71%

* Consumer Cyclical Sector Average

Performance Comparison

ADDYY

Adidas

99.02

-28.59

-22.40%

CROX

Crocs

86.29

-59.88

-40.97%

DECK

Deckers Outdoor

118.14

-41.74

-26.11%

NKE

Nike

77.92

-3.65

-4.47%

SKX

Skechers USA

63.08

-5.40

-7.89%

BIRK

Birkenstock Holding plc

52.45

2.55

5.11%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 11, 2025