On AG(US:ONON) Zhi Tong Cai Jing·2025-12-30 09:59Core Viewpoint - UBS maintains a "Buy" rating on On Running (ONON.US) with a target price of $85, citing the company's focus on innovation, performance, athlete engagement, direct sales model, and maintaining a premium brand image as key drivers for leading sales and profit growth in the industry [1] Group 1: Financial Projections - UBS forecasts that On Running's sales, adjusted EBITDA, and earnings per share will achieve compound annual growth rates of 20%, 24%, and 20% respectively over the next five years [1] - The strong growth momentum is expected to position On Running as one of the fastest-growing athletic apparel brands globally [1] Group 2: Brand Recognition and Market Potential - The UBS Evidence Lab's 11th annual global sports apparel survey indicates that On Running has significant growth potential, with brand awareness currently at 15%, which is substantially lower than competitors like Nike (91%), Under Armour (53%), and Lululemon (36%) [1] - Brand awareness for On Running increased from 13% last year to 15% this year, suggesting a positive trend that could lead to increased market share by 2026 [1] Group 3: Consumer Intent and Recommendations - On Running's global purchase intent for athletic shoes grew by 34% year-over-year, while purchase intent for athletic apparel surged by 122% [2] - The company's global net promoter score rose from 25% last year to 39% this year, ranking sixth globally, indicating a strong ability to convert brand awareness into actual customers [2] Group 4: Brand Recognition Success Factors - Four key areas where On Running has succeeded in becoming a top global athletic apparel brand include: 1. Recognition of high-quality products increased from 31% to 47% among global consumers [2] 2. Brand recognition as a well-known brand rose from 31% to 40% [2] 3. Recognition of On Running as a suitable athletic brand increased from 42% to 46% [2] 4. Perception of On Running as an innovative brand remains strong at 44%, despite a slight decline [2] Group 5: Opportunities for Improvement - A potential area for growth is the accessibility of On Running products, as only 25% of global consumers find the products easy to locate, down from 27% last year, which is among the lowest scores across brands [3] - This presents an attractive opportunity for On Running to expand its direct sales channel network [3]