2023-06-09 10:05:40 ET
UBS doubled down on its bullish view on On Holdings AG ( NYSE: ONON ) on Friday.
Analyst Jay Sole said the firm has strong conviction in its Buy rating after meeting with management during the week.
Sole and team's thesis on On Holding ( ONON ) is that the focus on innovation, performance, athletes, sports, direct-to-consumer selling, and maintaining a premium, full-price brand image should lead to industry leading sales growth and earnings beats.
"Our view is this will drive stock outperformance. We forecast On delivering a 44% 5-yr. EPS CAGR and expect strong growth to continue from there. This type of growth would make On one of the world's fastest growing athletic wear brands and worthy of a premium multiple, in our view."
Sole thinks many investors see On as mainly a running shoe brand and are missing out on the the brand's potential to address a much larger market.
UBS has a Buy rating on ONON and price target of $42, which is above the all-time high of $34.88.
Shares of On Holdings AG ( ONON ) jumped 6.69% in morning trading to cross back over the $30 level for the first time in three weeks.
More on On Holdings AG:
- On Holding: Poor Market Reaction To A Strong Q1 2023 Earnings Report
- On Holdings AG earnings call transcript
- On Holdings AG compared to sector peers
- Seeking Alpha's Quant Rating for On Holdings AG
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On Holding is seen running to new highs by UBS with brand strength picking up