On AG(US:ONON) Goldman Sachs·2024-08-14 02:57Investment Rating - The investment rating for ON Holding (ONON) is "Buy" with a 12-month price target of $47, indicating an upside potential of approximately 18.8% from the current price of $39.55 [4]. Core Insights - ON Holding reported a 2Q24 adjusted EBITDA of CHF 90.8 million, which is 5.3% above the FactSet consensus of CHF 86.2 million, driven by net sales of CHF 567.7 million, reflecting a year-over-year growth of 27.8% [1][3]. - The company reiterated its FY24 guidance, expecting at least 30% cFX sales growth, net sales of at least CHF 2.26 billion, a gross margin around 60%, and an adjusted EBITDA margin between 16% and 16.5% [2][3]. Summary by Category Financial Performance - 2Q24 net sales reached CHF 567.7 million, up 27.8% year-over-year, and 29.4% on a constant foreign exchange basis [1]. - The group gross margin was reported at 59.9%, which is a 40 basis points increase year-over-year [1]. - Adjusted EBITDA margins were at 16%, exceeding the consensus estimate of 15.3% [1][3]. Geographic Performance - Sales growth by geography in 2Q24 included EMEA at +22.2%, Americas at +25.8%, and APAC at +84.7% [1]. - Direct-to-Consumer (DTC) sales grew by 28.1%, while Wholesale sales increased by 27.6% [1]. Guidance and Valuation - The company expects FY24 net sales to be at least CHF 2.26 billion, with a gross margin around 60% and an adjusted EBITDA margin between 16% and 16.5% [2]. - The consensus FY24E adjusted EBITDA is expected to remain around CHF 378 million [2].