On Holding stock price target raised to $57 from $55 at TD Cowen

Investing.com - TD Cowen raised its price target on On Holding AG (NYSE:ONON) to $57.00 from $55.00 on Thursday, while maintaining a Buy rating on the Swiss athletic footwear company. This aligns with the broader analyst sentiment, as InvestingPro data shows a strong Buy consensus recommendation of 1.57 among analysts tracking the stock.

The new price target represents approximately 32 times TD Cowen’s fiscal year 2026 earnings per share estimate and about 20 times enterprise value to EBITDA. The firm considers this valuation "compelling" despite Wednesday’s 18% stock price increase. Currently, ONON trades at a P/E ratio of 48.28 and an EV/EBITDA of 25.83, with InvestingPro analysis indicating the stock is undervalued compared to its Fair Value.

TD Cowen views On Holding as a "structural winner" with strong positioning in both performance and lifestyle segments. The firm believes On is among the companies best positioned for growth and potential upside compared to consensus expectations. This view is supported by On’s impressive 33.26% revenue growth over the last twelve months and market capitalization of $13.58 billion.

The research note highlighted management’s consistent innovation across franchises and suggested that consensus estimates underestimate the durability of On’s growth and margin expansion opportunity.

TD Cowen pointed out that On’s non-GAAP EBIT margin for fiscal year 2025 is currently modeled at 14%, which is 500 to 600 basis points below competitors Deckers and Asics, implying potential for improvement.

In other recent news, On Holding AG reported strong third-quarter results, with significant revenue and adjusted EBITDA surpassing estimates by 39.2 million and 39.5 million Swiss francs, respectively. The company also raised its guidance for fiscal years 2025 and 2026, alleviating investor concerns about potential growth slowdowns, particularly in the U.S. market. UBS responded by increasing its price target for On Holding from $79 to $85, citing the company’s focus on innovation and maintaining a premium brand image as key growth drivers. Similarly, Truist Securities raised its price target from $60 to $65, highlighting a "very solid beat and raise" in financial performance.

Bernstein maintained an Outperform rating with a $70 target, reinforcing confidence in the company’s growth trajectory. Meanwhile, KeyBanc reiterated its Overweight rating with a $68 price target, noting strong performance in the apparel segment and Asia-Pacific markets. Stifel, however, lowered its price target to $60 from $66 due to market conditions, despite acknowledging the company’s results exceeded expectations. These developments reflect a positive outlook from several analyst firms on On Holding’s financial performance and strategic direction.

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