Fannie Mae, Freddie Mac shares tumble after conservatorship comments
On Thursday, HSBC analysts announced an upgrade of Adidas AG (ETR:ADSGN) (ADS:GR) (OTC: ADDYY) stock rating from Hold to Buy, despite reducing the price target to €240.00 from a previous €260.00. The upgrade comes amid expectations of the company gaining market share during a period when economic conditions are challenging and competitors are perceived to be struggling. According to InvestingPro data, Adidas (OTC:ADDYY), currently valued at $39.34B, appears slightly overvalued based on its Fair Value analysis, though its RSI suggests the stock may be oversold.
Erwan Rambourg from HSBC highlighted the potential for Adidas to accelerate its market share gains in the face of tough macroeconomic conditions and the relative weakness of its main competitors. The analyst's outlook suggests confidence in Adidas' ability to achieve superior top-line growth and operating leverage over the next two years. This optimism is supported by the company's strong fundamentals, including a healthy gross profit margin of 50.77% and impressive revenue growth of 10.53% over the last twelve months.
The revised price target of €240.00, down from €260.00, reflects lower estimates but is partly offset by a discounted cash flow (DCF) roll-over. The adjustment in the price target is accompanied by a positive shift in the stock's rating, moving from Hold to Buy, as stated by the HSBC analyst.
Rambourg's commentary on the upgrade emphasizes the firm's expectation of Adidas' strong performance despite the downward adjustment in the price target. "Market share gains could accelerate at a time when macro is tough and main competitors are weak. We see good visibility for superior top-line growth and operating leverage in the next two years. TP down to EUR240 (from EUR260) as much lower estimates partly mitigated by DCF roll-over; upgrade to Buy (from Hold)," Rambourg explained.
Investors and market watchers will be keeping a close eye on Adidas' performance, particularly in how the company navigates the challenging economic landscape and its efforts to outpace competitors in the sportswear industry. InvestingPro subscribers can access additional insights through the comprehensive Pro Research Report, which includes detailed analysis of Adidas's financial health, competitive position, and growth prospects among 1,400+ top stocks covered by the platform.
In other recent news, Adidas AG's financial outlook has been a focal point for analysts. Bernstein maintained an Outperform rating on Adidas, with a price target of EUR 300.00, citing strong consumer demand and a promising product pipeline. Meanwhile, RBC Capital Markets also maintained an Outperform rating but adjusted their price target slightly to EUR 285.00, reflecting Adidas's robust forward wholesale order book and strategic growth avenues. Deutsche Bank (ETR:DBKGn), while keeping a Buy rating, reduced its price target to EUR 280.00, acknowledging Adidas's operational efficiency despite a relatively flat share price since April 2024.
TD Cowen has held a Hold rating with a price target of EUR 262.00, noting the company's strong start to fiscal year 2025 and consistent margin improvements. Adidas's management has been recognized for surpassing conservative financial goals, with a reported 12% top-line growth in fiscal year 2024. Analysts across the board have highlighted Adidas's strategic positioning and operational improvements, which are expected to drive continued growth and profitability into 2025.
RBC Capital Markets also identified Adidas as a more attractive Outperform idea due to strong brand momentum and visibility in its wholesale order book. The recent developments suggest that Adidas is well-positioned for growth despite potential competitive pressures, with several firms expressing confidence in the company's market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.