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PUMA (PUMSY)
OTHER OTC:PUMSY
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PUMA
(OTC:PUMSY)
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Rating:75Outperform
Price Target:
$3.00
▲(66.67% Upside)
Action:UpgradedDate:01/28/26
The score is driven primarily by solid financial performance (healthy margins, improved leverage, and strong free cash flow growth) and supportive technical momentum (price above major moving averages with positive MACD). Offsetting these strengths, valuation is less favorable due to a negative P/E despite a moderate dividend yield.
Positive Factors
Strong cash generation
PUMA's robust cash conversion — OCF at 2.47x net income and FCF growth of 22.3% — supports sustained reinvestment, DTC expansion, and capital returns without relying on external funding. Durable free cash flow reduces refinancing risk and funds strategic initiatives over the next few years.
Improving balance sheet and leverage
An improving leverage profile (D/E 0.61) and a stronger equity base enhance financial flexibility for capex, inventory management and global expansion. A healthier capital structure lowers interest burden and provides resilience against cyclical retail downturns and currency/market shocks.
High gross and stable operating margins
Elevated gross margins (~47%) and stable EBIT/EBITDA show structural pricing power and cost efficiency across products and channels. These margin foundations support profitability through investments in brand, DTC and supply chain, enabling sustainable operating leverage as sales scale.
Negative Factors
Declining net profit margin
A falling net margin, even if modest, signals pressure below the operating line — from higher interest, taxes, or non-operating items — that can erode retained earnings and limit long-term reinvestment and payout capacity if the trend continues.
Volatile earnings (EPS collapse)
Severely negative EPS growth indicates earnings volatility or one-off impacts that reduce predictability of core earnings power. Persistent EPS swings complicate planning for capex, dividends and M&A, and raise the risk premium required by long-term capital providers.
Major shareholder change and regulatory uncertainty
A new 29% strategic shareholder introduces governance and strategic risk: potential shifts in global strategy, integration tensions, or prioritization toward partner objectives. The multiyear regulatory approval process adds execution uncertainty that can affect long-term planning and capital allocation.
PUMA (PUMSY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.03B
Dividend Yield2.78%
Average Volume (3M)9.65K
Price to Earnings (P/E)―
Beta (1Y)0.99
Revenue Growth-1.22%
EPS Growth-217.46%
CountryUS
Employees22,000
SectorConsumer Cyclical
Sector Strength84
IndustryApparel - Footwear & Accessories
Share Statistics
EPS (TTM)-0.26
Shares Outstanding1,480,079,200
10 Day Avg. Volume0
30 Day Avg. Volume9,650
Financial Highlights & Ratios
PEG Ratio-3.36
Price to Book (P/B)2.31
Price to Sales (P/S)0.74
P/FCF Ratio15.13
Enterprise Value/Market Cap1.45
Enterprise Value/Revenue0.68
Enterprise Value/Gross Profit1.44
Enterprise Value/Ebitda9.84
Forecast
1Y Price Target
$4.50Price Target Upside150.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)-0.2
Revenue Forecast (FY)$8.16B
PUMA Business Overview & Revenue Model
Company DescriptionPUMA SE is a global athletic and lifestyle brand that designs and manufactures footwear, apparel, and accessories. Founded in 1948 and headquartered in Herzogenaurach, Germany, PUMA operates in the sports and lifestyle sectors, catering to a diverse customer base ranging from professional athletes to fashion-conscious consumers. The company is known for its innovative designs and collaborations with high-profile athletes and celebrities, emphasizing performance, style, and sustainability in its product offerings.
How the Company Makes MoneyPUMA generates revenue primarily through the sale of its products across various segments, including performance (sports) and lifestyle categories. The company's revenue model relies heavily on direct-to-consumer sales through its own retail stores and e-commerce platforms, as well as wholesale distribution to third-party retailers. Key revenue streams include footwear, apparel, and accessories, with a focus on high-margin products. Significant partnerships and sponsorships with professional sports teams, athletes, and influencers enhance brand visibility and drive sales. Additionally, PUMA's ongoing commitment to sustainability and innovation in product development attracts environmentally conscious consumers, further bolstering its earnings.
PUMA Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Negative
The call outlines decisive corrective actions and several positive product, channel and licensing developments (D2C share gains, inventory cleanup ahead of plan, royalty growth, successful product launches and strengthened partnerships). However, these positives are set against material near-term financial deterioration: steep Q4 and full-year sales declines, significant wholesale pain, large operating losses, negative free cash flow, higher net debt and notable one-time charges. Management expects 2026 to be a transition year with gradual improvement in gross margin and a path back to growth and profitability in 2027, but short-term risks remain substantial.Q4-2025 Updates
Positive Updates
Clear Strategic Reset and Rightsizing Underway
Management initiated a 3-year transformation (reset) in 2025: cleaning undesirable wholesale, reducing discounts, reducing range complexity (double-digit range cuts), and rightsizing headcount (target ~20% reduction in white-collar roles between 2025–2026; 500 positions cut H1 2025 with further reductions underway).
D2C Mix Increased and Channel Shift Progress
Direct-to-consumer (D2C) share rose materially: Q4 D2C share 41.1% (from 35.5% in Q4 2024); full year D2C share 32.4%. Full-year D2C sales increased 3% despite Q4 D2C down 8% (e-commerce -20%, owned stores ~-1%). Management expects D2C growth to continue and be a structural priority.
Inventory Cleanup Ahead of Plan
Company reported inventory cleanup slightly ahead of plan: Q4 inventories started to decline after targeted takebacks; reported inventory +2% (currency-adjusted +11%) to ~EUR 2.1bn, with commitment to return inventories to normalized levels by end-2026.
Cost Efficiency and OpEx Discipline
Operating expenses (ex onetime effects) fell ~8% in Q4 to EUR 887m and were flat year-over-year at ~EUR 3.5bn for FY 2025, reflecting savings from the efficiency program and lower D2C spending despite lower sales.
Strong Licensing/Royalty Performance
Royalty and commission income increased 36% in Q4 and rose 4.4% year-over-year to EUR 92m for FY 2025, supported by changes in partnership structures (e.g., United Legwear).
Sport & Brand Momentum and Product Wins
Notable sports achievements (Mondo Duplantis world record, marathon and running milestones, 10 teams qualified for FIFA World Cup), strategic partnerships (extended HYROX, new McLaren F1 partnership) and successful recent product launches (handball personalized sellout, HYROX dedicated footwear sellout, Deviate NITRO Elite 4) that signal demand for premium product lines.
Liquidity Measures and Financing Secured
Financial headroom ~EUR 1.5bn at end-2025 (cash EUR 290m + ~EUR 1.2bn unutilized credit lines); secured additional EUR 100m private placement in Feb-2026 and reduced bridge facility, providing near-term liquidity to support transformation.
Gross Margin Tailwinds Expected in 2026
Management expects a substantial improvement in gross margin in 2026 driven by lower promotions, reduced inventory reserves, and a more favorable channel mix (shift toward D2C).
Negative Updates
Sharp Sales Decline in Q4 and FY 2025
Currency-adjusted sales declined nearly 21% in Q4 2025 and ~8% for full year 2025. Reset measures (cancellations, takebacks, reduced promotions) were cited as main drivers of the top-line decline.
Wholesale Channel Hit Hard
Wholesale sales fell ~28% in Q4 and ~13% for FY 2025 due to inventory takebacks and a deliberate reduction in mass-merchant exposure (notably in North America and Latin America).
Significant Regional Weakness — North America & Greater China
North America sales: >33% decline in Q4 and ~19% decline for FY 2025. Greater China: almost 20% decline in Q4; management expects potential further short‑term negative impact in China in 2026 following ANTA's 29% stake and anticipated DTC/distribution shifts.
Profitability and Earnings Deterioration
Q4 adjusted EBIT was minus EUR 229m (down EUR 315m vs Q4 2024); Q4 reported EBIT ~-EUR 308m. FY 2025 adjusted EBIT (ex onetime) was -EUR 166m; reported EBIT -EUR 357m; loss from continuing operations ~-EUR 644m.
Gross Profit Margin Compression
Gross profit margin fell ~7.5 percentage points in Q4; full-year gross margin declined 260 basis points to 45%, driven by increased wholesale promotions, inventory reserves, and unfavorable currency effects.
Negative Operating Cash Flow and Free Cash Flow
Operating cash flow was negative ~EUR 320m in FY 2025; CapEx ~EUR 206m; free cash flow ~-EUR 530m. Cash balance fell from ~EUR 370m (end-2024) to EUR 290m (end-2025).
Net Debt and Working Capital Pressures
Net debt increased to just over EUR 1bn. Working capital rose >20% year-over-year to >EUR 1.5bn and now represents 21% of group sales (versus ~15% in FY 2024), reflecting inventory and receivable/payable dynamics (inventories +2% reported; trade receivables -27%; trade payables -33%).
Material One-time Charges and Impairments
Onetime effects ~EUR 79m in Q4 and ~EUR 192m for FY 2025 (personnel costs ~EUR 102m related to efficiency program; goodwill impairments ~EUR 63m; store closures and other non-operating costs ~EUR 27m).
No Dividend Proposed for 2025
Due to the net loss and to preserve liquidity, management and supervisory board will propose no dividend payment for 2025 at the 2026 AGM.
2026 Outlook Still Weak Near-term
Guidance for 2026: constant-currency sales decline expected in the low- to mid-single-digit range (with ~3 percentage points FX headwind), reported EBIT forecast between -EUR 50m to -EUR 150m, and OpEx not materially lower in absolute terms — indicating a continuing transition year before targeted recovery in 2027.
Company Guidance
PUMA guided that FY2026 will be a transition year with constant-currency sales expected to decline in the low- to mid-single-digit range (with ~3 percentage points of FX headwind), driven by further North America distribution cleanup, while D2C is expected to grow and wholesale to decline; management expects H2 to be stronger than H1 and Q1 to align with the full-year outlook. Reported EBIT is forecast at a loss of €50m–€150m (including onetime effects that should be materially below 2025’s ~€192m), with a “substantial” improvement in gross margin versus 2025 (FY2025 gross margin 45%, down 260 bps) and OpEx not materially lower in absolute terms; CapEx is guided to ~€200m. The company expects positive free cash flow in 2026 (vs. 2025 FCF -€530m), is targeting net-debt reduction from end-2025 net debt just over €1bn (cash €290m; financial headroom ~€1.5bn including ~€1.2bn undrawn facilities), and noted a €100m private placement and reduction of the bridge facility to €350m; management also warned of a likely short-term negative impact in Greater China linked to ANTA’s 29% stake.PUMA Financial Statement Overview
Summary
Strong overall financial health supported by steady revenue growth, stable EBIT/EBITDA margins, improved leverage (debt-to-equity 0.61), and robust cash generation (operating cash flow to net income 2.47; free cash flow up 22.3%). The main drawback is a modest decline in net profit margin (3.5% to 3.2%).Income Statement
PUMA has shown consistent revenue growth, with a 2.5% increase from 2023 to 2024, following a similar growth trend from previous years. The gross profit margin for 2024 stands at 47.4%, indicating strong profitability, although slightly lower than 2023's 46.3%. The EBIT margin is stable at 7.1%, and the EBITDA margin shows a positive trend at 11.1%. However, net profit margin decreased from 3.5% in 2023 to 3.2% in 2024, highlighting a slight concern in net income efficiency.80
Positive
Balance Sheet
PUMA maintains a healthy balance sheet with an improving equity base, as evidenced by the increase in stockholders' equity to $2.83 billion in 2024. The debt-to-equity ratio improved to 0.61, reflecting better leverage management. Return on equity for 2024 is 10%, showing effective use of equity, but there is room for improvement. The equity ratio is 39.6%, indicating a solid capital structure.75
Positive
Cash Flow
The company has demonstrated robust cash flow management, with operating cash flow to net income ratio at 2.47, indicating strong cash generation relative to net income. Free cash flow grew by 22.3% from 2023 to 2024, reflecting effective capital expenditure management. The free cash flow to net income ratio is 1.53, showcasing strong cash profitability.78
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 8.62B | 8.82B | 8.60B | 8.47B | 6.81B | 5.23B |
| Gross Profit | 4.06B | 4.18B | 3.99B | 3.90B | 3.26B | 2.46B |
| EBITDA | 592.65M | 977.60M | 936.60M | 1.03B | 855.50M | 534.00M |
| Net Income | -94.20M | 281.60M | 304.90M | 353.50M | 309.60M | 78.90M |
Balance Sheet | ||||||
| Total Assets | 7.06B | 7.14B | 6.64B | 6.77B | 5.73B | 4.68B |
| Cash, Cash Equivalents and Short-Term Investments | 292.60M | 537.00M | 598.50M | 484.70M | 787.70M | 685.20M |
| Total Debt | 2.58B | 1.72B | 1.80B | 1.56B | 1.40B | 1.20B |
| Total Liabilities | 4.96B | 4.31B | 4.06B | 4.23B | 3.45B | 2.92B |
| Stockholders Equity | 2.09B | 2.83B | 2.55B | 2.47B | 2.21B | 1.72B |
Cash Flow | ||||||
| Free Cash Flow | 0.00 | 431.80M | 353.20M | 154.70M | 257.70M | 270.50M |
| Operating Cash Flow | 0.00 | 694.80M | 653.60M | 418.30M | 460.10M | 421.50M |
| Investing Cash Flow | 0.00 | -230.50M | -284.60M | -240.80M | -183.80M | -145.50M |
| Financing Cash Flow | 0.00 | -697.80M | -277.10M | -476.40M | -164.00M | -129.20M |
PUMA Technical Analysis
Positive
1.80
Price Trends
2.66
Positive
2.45
Positive
2.45
Positive
Market Momentum
0.04
Negative
60.84
Neutral
52.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PUMSY, the sentiment is Positive. The current price of 1.8 is below the 20-day moving average (MA) of 2.73, below the 50-day MA of 2.66, and below the 200-day MA of 2.45, indicating a bullish trend. The MACD of 0.04 indicates Negative momentum. The RSI at 60.84 is Neutral, neither overbought nor oversold. The STOCH value of 52.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PUMSY.
PUMA Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $4.03B | -12.09 | -12.22% | 2.78% | -1.22% | -217.46% | |
62 Neutral | $4.86B | ― | -5.19% | ― | <0.01% | -77.31% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $1.44B | 16.77 | 25.57% | 2.28% | 3.61% | ― | |
56 Neutral | $2.71B | 59.30 | 5.21% | 1.97% | 6.26% | -66.51% | |
54 Neutral | $94.88B | 37.58 | 17.95% | 2.81% | -5.06% | -47.51% |
* Consumer Cyclical Sector Average
PUMSY
PUMA
2.93
-0.02
-0.58%
CROX
Crocs
92.70
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-6.90%
NKE
Nike
63.95
-13.66
-17.60%
SHOO
Steven Madden
36.86
4.95
15.51%
WWW
Wolverine World Wide
19.98
5.51
38.09%
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.