Bernstein analysts upgraded shares of Adidas AG (OTC:ADDYY) to Outperform from Market Perform in a note Monday, lifting the price target to $112.32 from $91.63 per share.
The analysts told investors that there is a "Messi year ahead," but the brand is heating up.
"Adidas brand heat languished through 2022 as Yeezy, China, CEO change, product launch delays, and excess inventory took their toll," they explained.
They noted various positives for Adidas, including superstar Lionel Messi signing for David Beckham's MLS club Inter Miami last week.
"Now we are seeing it heat up again - China KOLs are back, T-Toe style is driving strong interest, Yeezy sold out last week, Messi in Miami is likely to drive US mkt share, and US / China / European retailers sounded positive in our channel checks this week."
"We model a gradual margin pickup, below CEO targets, but still get clear upside from a return to HSD top-line growth," the analysts concluded.