Core Viewpoint - UBS maintains a 'Buy' rating and an $85 price target for ON Holding, anticipating that P/E expansion will drive the stock price higher despite foreign exchange challenges [1] Group 1: Earnings and Growth Projections - The company's long-term growth trajectory remains intact, with UBS forecasting five-year compound annual growth rates of 17% for sales, 19% for adjusted EBITDA, and 28% for earnings per share [2] - UBS expects first-half 2026 sales growth, excluding foreign exchange impacts, to exceed the full-year guidance of 23% [3] - Fiscal 2026 earnings per share estimates were lowered by about 7% due to a challenging foreign exchange outlook, but fiscal 2027 and 2028 EPS estimates remain unchanged [7][8] Group 2: Margin and Reinvestment - Margin performance is highlighted as a key enabler for reinvestment, with premium positioning and supply chain innovation driving stronger-than-expected gross margins [5] - Strategic brand reinvestments are believed to underpin industry-leading growth and support strong future performance [5] Group 3: Technological Advancements - Progress in scaling On's LightSpray technology is noted, with a new factory in South Korea increasing production capacity by 30 times ahead of a global launch [6] - Analysts believe that ONON's growth will positively surprise the market, leading to a higher P/E rerating [6] Group 4: Valuation Outlook - UBS argues that the growth outlook supports a higher valuation multiple, expecting a 33x forward two-year P/E multiple compared to the current 20x [7]