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On Tuesday, TD Cowen reaffirmed their positive stance on On Holding AG (NYSE:ONON), maintaining a Buy rating and a $64.00 price target. The firm’s analyst emphasized the company’s robust growth strategy that is expected to extend into 2025 and beyond, suggesting that now is an opportune time to accumulate shares following the recent sector downturn, which saw the company’s market capitalization drop 30% from its all-time high on January 30, 2025. According to InvestingPro data, the company maintains impressive revenue growth of 29.36% and a strong gross profit margin of 60.63%, supporting the positive outlook.
TD Cowen highlighted On Holding AG as their top pick for 2024 and have now named it their Europe Best Idea for 2025. The firm believes that both sell-side and buy-side consensus are underestimating the company’s potential for margin expansion. On Holding AG, based in Zurich, is noted for its premium innovation in lifestyle and performance categories, with strong average selling prices leading the sector. InvestingPro analysis reveals the company’s robust financial health with a "GREAT" overall score, backed by strong liquidity with a current ratio of 2.66.
On Holding AG has established itself as a leader in hands-free technology, style, and comfort within lifestyle markets, as well as performance-based products for running and tennis. The intersection of premium lifestyle and performance branding is seen as a key driver for the company’s growth, with a total addressable market that supports a trajectory toward over CHF 6 billion in revenue, according to TD Cowen’s analysis.
The analyst pointed out that On Holding AG is currently trading at a standard deviation below its historical average valuation, marking it as the cheapest it has been in terms of enterprise value to EBITDA and sales multiples since it went public. This valuation presents an attractive entry point for investors, as suggested by TD Cowen.
In other recent news, On Holding AG has garnered attention with several notable developments. UBS raised its price target for the company to $73, maintaining a Buy rating, following a robust fourth-quarter report that exceeded medium-term financial objectives. The company is expected to achieve significant growth in sales, EBITDA, and EPS over the next five years. Meanwhile, HSBC upgraded On Holding AG’s stock from Hold to Buy, increasing the price target to $58, citing a more optimistic outlook due to the company’s performance in FY2024. Piper Sandler also maintained its Overweight rating with a $62 price target, highlighting the company’s consistent performance and realistic guidance for the second half of 2025. TD Cowen, while keeping a Buy rating, slightly lowered the price target to $64, acknowledging strong fourth-quarter results and significant growth in various regions and channels. Bernstein continues to support the company with an Outperform rating and a $70 price target, noting strong sales and margin improvements. These recent analyst actions reflect a positive sentiment towards On Holding AG’s strategic direction and financial performance.
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