TSX slightly higher on employment data
Investing.com - JPMorgan downgraded Puma SE (ETR:PUM) (OTC:PMMAF) from Neutral to Underweight and lowered its price target to EUR16.00 from EUR21.00. The company’s shares, currently trading at $24.76, have declined over 45% year-to-date, with InvestingPro data showing three analysts revising their earnings expectations downward for the upcoming period.
The downgrade comes as JPMorgan believes Puma is in the early stages of a business turnaround under new CEO Arthur Hoeld, who is working to reset investor expectations, reduce excess inventory, and strengthen distribution networks.
The investment bank cautioned that successful turnarounds require time, noting it took Puma five years to recover earnings during its 2013 turnaround, and execution risk remains high in the current environment.
JPMorgan cited additional challenges from competitive pressures, particularly from a potential Nike comeback, which could further delay Puma’s penetration into wholesale channels.
Despite Puma shares rising approximately 15% over the past month, driven largely by merger and acquisition speculation, JPMorgan identified medium to long-term risks of Puma losing its competitive edge in the sporting goods market.
In other recent news, UBS has upgraded Puma’s stock rating from Sell to Neutral. This change comes in light of potential shifts in Artemis’s ownership stake in the company. UBS has also increased its price target for Puma to EUR20.90 from EUR16.30. The news about Artemis, which holds a 29% stake in Puma, is seen as a factor that could alter investor focus. These developments reflect changing market dynamics, as noted by UBS. The potential stake sale by Artemis might temporarily divert attention from Puma’s fundamental performance. This upgrade by UBS indicates a shift in how the market may perceive Puma’s stock in the near term.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.