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On Wednesday, KeyBanc Capital Markets reaffirmed its positive stance on On Holding AG (NYSE:ONON), maintaining an Overweight rating and a $68.00 price target for the company’s shares. The endorsement comes after On Holding reported a comprehensive beat on its financial results, impressing with its performance and forward-looking guidance for fiscal year 2025. According to InvestingPro data, five analysts have recently revised their earnings estimates upward, with analyst targets ranging from $49.91 to $73.04.
On Holding’s success was attributed to its effective execution and the company’s ability to leverage its rapidly growing global brand recognition. Additionally, the firm’s direct-to-consumer (DTC) channels showed robust momentum. This achievement positions On Holding as one of the standout performers in the current earnings cycle, with impressive gross profit margins of 60.63% and revenue growth of 29.36% over the last twelve months. InvestingPro analysis reveals the company maintains strong financial health with a "GREAT" overall score, suggesting solid fundamentals supporting its growth trajectory.
KeyBanc’s analysis suggests that On Holding is on track to surpass its three-year plan, with sustained momentum into the first quarter of 2025. The financial institution also noted that the company’s guidance for the fiscal year appears to contain a degree of conservatism, leaving room for potential upside as On Holding continues to execute its strategic initiatives effectively. While currently trading above its Fair Value according to InvestingPro calculations, the company’s strong liquidity position and robust balance sheet, with more cash than debt, support its growth initiatives.
The analyst’s comments reflected confidence in On Holding’s trajectory, stating, "Looking to 2025, momentum has continued, and we believe FY guidance does embed some level of caution as we exit the 1H of the year, providing us with optimism that we could get upside with continued execution against strategic initiatives. Remain OW."
Investors and market watchers will be keeping a close eye on On Holding as the company progresses through the fiscal year, aiming to maintain its growth and deliver on the expectations set forth by its recent performance and guidance.
In other recent news, On Holding AG has reported a robust increase in its financial performance. The company announced a 40.6% rise in net sales for the fourth quarter, reaching CHF 606.6 million, and a full-year net sales of CHF 2.32 billion, marking a 33.2% growth on a constant currency basis. Looking forward, On Holding AG has set ambitious targets for 2025, aiming for net sales of at least CHF 2.94 billion and a gross profit margin around 60.5%. Barclays (LON:BARC) has adjusted its price target for the company to $64, citing a positive outlook on financial performance despite minor revisions in earnings estimates.
Needham has maintained a Buy rating with a $64 target, highlighting the company’s strong brand recognition and distribution growth. Truist Securities also reiterated a Buy rating with a $61 target following On Holding AG’s impressive fourth-quarter results, which included a 36% revenue growth. The company plans significant expansion in China and new product launches, such as collaborations with celebrity Zendaya, which are expected to drive future growth. These developments underscore On Holding AG’s strategic focus on innovation and market expansion.
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