ONON - On Holding's Long Runway For Growth Looks Intriguing
2024-06-28 17:15:56 ET
Summary
- On Holding is a story stock with potential for high growth and returns, requiring patience.
- On Holding's growth strategy includes increasing brand recognition through elite athletes, innovative shoe designs, and expansion into different demographics and product categories.
- The company's financials show strong revenue and operating income growth, debt-free status, and potential for margin expansion.
- A DCF analysis based on ONON's financials and a reasonable comp with Hoka shows that the valuation may be reasonable for the stock.
Investment Thesis
On Holding ( ONON ) is in the early stages of its growth strategy. After turning profitable in recent years, ONON is still very much a story stock, a company that has the potential to grow at high rates and deliver great returns to shareholders. It is also a stock that requires patience, is likely a long-term investment idea, and comes with the inherent risk of a company acting as a disruptive force in a fragmented and competitive market dominated by companies exponentially larger than it is.
Pages five through nine of On Holding’s 20-F is dedicated to 2023 Memorable Moments. Hellen Obiri is highlighted for her back-to-back Boston Marathon victories, the company introduced its CloudTec Phase cushioning platform with the On Cloudsurfer, its flagship store on Regent Street in London, the success of its two great tennis athletes, Iga Swiatek and Ben Shelton are highlighted, as well as several other initiatives including the expansion of its product offerings into footwear for kids and pre-teens....
On Holding's Long Runway For Growth Looks Intriguing