Core Viewpoint - On Holding AG is experiencing growth driven by strong footwear franchises, but potential pressures from tariffs are anticipated in 2026 [1][4]. Group 1: Growth and Market Performance - On is expected to report its fourth quarter and full-year earnings results soon, with analysts believing it will remain a compelling growth story due to increasing brand awareness globally [2]. - Online search trends for On have seen over 30% growth in the U.S. and over 75% growth globally, with social media followers increasing nearly 30% year-over-year [2]. - Most of On's growth has been primarily from North America, but Asia and EMEA are emerging markets expected to contribute more to overall growth this year, with Asia now accounting for a "high-teens percent" of sales [3]. Group 2: Regional Developments - EMEA has experienced a re-acceleration in growth, with four consecutive quarters of growth exceeding 33%, outpacing the U.S. growth of 20% to 25% [3]. - The cleanup of distribution channels in Europe, including exiting family footwear channels, has positioned On as a premium athletic brand, expanding through key retailers like Foot Locker and JD Sports [3]. Group 3: Supply Chain and Financial Outlook - The impact of tariffs is expected to be fully felt in the first quarter of fiscal year 2026, with a planned gross margin decline anticipated for that year [4]. - Although On sources almost none of its products from China, it is affected by tariffs on Vietnamese imports, and there may be foreign exchange headwinds due to a stronger Swiss franc [4]. Group 4: Product Introductions and Expansion Plans - On has a strong lineup of footwear product introductions planned for 2026, including Cloudmonster 3 and Cloudrunner 3 in the first quarter, and Cloudsurfer 3 in the third quarter [5]. - The company plans to open between 20 to 25 new stores and continue expanding in underpenetrated markets such as Asia Pacific, parts of Europe, and Latin and South America [5].

Core Insights - ON Holding AG (ONON) has raised its full-year 2025 net sales growth forecast to 34% from 31% on a constant-currency basis, indicating strong demand across various channels and regions [1][8] - The company aims to double its net sales by 2026, projecting a minimum 30% constant currency CAGR from 2023 to 2026, with at least 23% growth expected in 2026 [2][8] - Key growth drivers include apparel, direct-to-consumer sales, and momentum in the Asia Pacific markets, alongside product innovations like the upcoming Cloudrunner Max [3][4][8] Sales and Financial Metrics - The updated sales forecast suggests reported net sales of CHF 2.98 billion for 2025, an increase from the previous estimate of CHF 2.91 billion [1] - The Zacks Consensus Estimate for ONON's current financial-year sales implies a year-over-year growth of 41.2%, while earnings per share are expected to decline by 12.7% [11] - Current estimates for sales in the next year (2026) are projected at CHF 4.49 billion, reflecting a year-over-year growth of 20.64% [12] Competitive Positioning - ONON's shares have increased by 37.7% over the past month, outperforming the industry average rise of 17.6% [5] - The company trades at a forward P/E ratio of 28.85, which is higher than the industry average of 18.04, indicating a premium valuation compared to competitors like Deckers and Dollar General [6][9]

Core Viewpoint - On Holdings AG's stock has been declining as investors express concerns about its future growth prospects, particularly in light of Nike Inc.'s resurgence [1][2] Group 1: Growth Trajectory - There have been concerns since April regarding On's ability to sustain its growth trajectory, with Wall Street anticipating a solid third quarter report [2] - Telsey Advisory Group analyst Cristina Fernández predicts a "natural deceleration" in On's growth rate to 20% in the third quarter from 32% in the previous quarter [3] - Despite the anticipated deceleration, there is still "very good traffic" to On stores, and the brand is expected to benefit from strength in its tennis category and a strong wholesale order book [4] Group 2: Competitive Position - Concerns about Nike's rebound affecting On are considered "overblown," as On's diverse growth drivers across channels, geography, and product categories make it less vulnerable to Nike's improvements [5] - Management's comments suggest a focus on strategically controlling growth to sustain strong multi-year gains rather than indicating a decline in underlying demand [6] Group 3: Future Prospects - Analyst Janine Stichter believes On can sustain revenue growth exceeding 20% in the medium term, which is the highest among its peers, justifying a premium valuation [6] - Stichter has set a price target of $70 for On shares, highlighting the potential positive impact of recent product launches and events, such as the Cloudzone launch and Hellen Obiri's NYC Marathon win [6] - Upcoming product launches in 2026, including the relaunch of Cloudmonster 3 and Cloudrunner 3, are expected to contribute to continued growth, along with strong wholesale sell-through and share gains in the direct-to-consumer channel [7]