ON (NYSE:ONON) Trading Up 4.3% - What's Next?

Key Points

• ON Holding shares rose 4.3% to about $30.66 in midday trading, although volume was below average.
• The company authorized a $1 billion share buyback through 2029, set a target of at least CHF 5.6 billion in 2029 sales, and maintained its full-year outlook with approximately $1.2 billion in third-quarter revenue guidance.
• Analysts give ONON a consensus “Moderate Buy” rating with a $44.04 average price target, but execution risks remain after the company recently missed quarterly earnings and revenue estimates.

On Holding AG (NYSE:ONON - Get Free Report)'s share price was up 4.3% during trading on Wednesday . The stock traded as high as $30.42 and last traded at $30.66. Approximately 5,778,521 shares traded hands during mid-day trading, a decline of 13% from the average session volume of 6,662,469 shares. The stock had previously closed at $29.39.

Key Stories Impacting ON

Here are the key news stories impacting ON this week:

• Positive Sentiment: Large buyback supports the stock. On Holding authorized a share-repurchase program of up to $1 billion through the end of 2029. Buybacks can increase earnings per share, provide demand for the stock and signal management’s confidence in future cash generation. Reuters report on On Holding buyback and targets
• Positive Sentiment: Long-term growth targets are ambitious. On Holding is targeting at least CHF 5.6 billion in net sales by 2029, supported by high-teens annual growth in constant-currency terms. The company is betting on continued momentum in sneakers and apparel, as well as expansion into additional sports categories. StreetInsider report on On Holding targets
• Positive Sentiment: Near-term outlook was maintained. The company confirmed its full-year outlook and provided third-quarter revenue guidance of approximately $1.2 billion, broadly in line with consensus expectations. This reduces concern about an immediate slowdown despite recent investor focus on execution. RTTNews report on On Holding guidance
• Neutral Sentiment: Analyst and investor attention has increased. Several reports highlighted ONON among consumer-cyclical and outdoor stocks, while Zacks noted that the company is attracting unusually high user interest. This may increase trading activity but does not by itself change the company’s fundamentals. Zacks analysis of On Holding
• Negative Sentiment: Execution risk remains. Reaching the 2029 targets will require sustained high growth and successful expansion into new categories. ONON also remains a volatile stock, so investors may reassess the shares if sales momentum, margins or buyback execution disappoint.

Analysts Set New Price Targets

Several analysts have recently weighed in on the company. JPMorgan Chase & Co. began coverage on ON in a report on Thursday, July 2nd. They set an "overweight" rating and a $51.00 price target on the stock. Berenberg Bank set a $38.00 price target on shares of ON in a research report on Monday, September 14th. Capital One Financial set a $28.00 price objective on shares of ON in a research note on Tuesday, September 8th. Robert W. Baird lowered their target price on ON from $70.00 to $55.00 and set an "outperform" rating for the company in a research report on Wednesday, August 12th. Finally, Telsey Advisory Group reduced their price target on ON from $51.00 to $43.00 and set an "outperform" rating on the stock in a research report on Wednesday, August 12th. Two equities research analysts have rated the stock with a Strong Buy rating, twenty have issued a Buy rating, four have assigned a Hold rating and two have issued a Sell rating to the company's stock. According to MarketBeat.com, the stock has an average rating of "Moderate Buy" and a consensus target price of $44.04.

ON Stock Up 3.1%

The company has a current ratio of 2.83, a quick ratio of 2.25 and a debt-to-equity ratio of 0.25. The stock's 50-day moving average price is $32.07 and its 200-day moving average price is $35.24. The company has a market cap of $19.34 billion, a P/E ratio of 20.62, a PEG ratio of 0.55 and a beta of 2.08.

ON (NYSE:ONON - Get Free Report) last announced its quarterly earnings results on Tuesday, August 11th. The company reported $0.35 earnings per share for the quarter, missing the consensus estimate of $0.42 by ($0.07). ON had a net margin of 12.09% and a return on equity of 22.92%. The business had revenue of $1.05 billion during the quarter, compared to the consensus estimate of $1.09 billion. During the same period in the previous year, the business posted ($0.09) EPS. ON's revenue was up 13.5% compared to the same quarter last year. As a group, research analysts forecast that On Holding AG will post 1.49 EPS for the current year.

Insider Buying and Selling at ON

In other news, insider Olivier Bernhard acquired 65,000 shares of the business's stock in a transaction on Friday, August 14th. The shares were purchased at an average cost of $30.67 per share, with a total value of $1,993,550.00. Following the acquisition, the insider directly owned 5,228,184 shares of the company's stock, valued at $160,348,403.28. The trade was a 1.26% increase in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CEO Caspar Coppetti bought 65,000 shares of the stock in a transaction dated Friday, August 14th. The stock was purchased at an average price of $30.67 per share, with a total value of $1,993,550.00. Following the acquisition, the chief executive officer owned 2,440,855 shares of the company's stock, valued at $74,861,022.85. The trade was a 2.74% increase in their ownership of the stock. Additional details regarding this purchase are available in the official SEC disclosure.

Hedge Funds Weigh In On ON

Several institutional investors have recently modified their holdings of the business. Cullen Frost Bankers Inc. lifted its holdings in ON by 639.7% during the fourth quarter. Cullen Frost Bankers Inc. now owns 540 shares of the company's stock valued at $25,000 after purchasing an additional 467 shares during the last quarter. EverSource Wealth Advisors LLC lifted its stake in shares of ON by 69.6% during the 1st quarter. EverSource Wealth Advisors LLC now owns 760 shares of the company's stock valued at $26,000 after buying an additional 312 shares in the last quarter. MidAtlantic Capital Management Inc. bought a new position in ON in the 4th quarter worth approximately $27,000. Ascentis Independent Advisors bought a new position in ON in the 1st quarter worth approximately $34,000. Finally, State of Wyoming grew its stake in ON by 132.6% in the 1st quarter. State of Wyoming now owns 4,508 shares of the company's stock valued at $153,000 after buying an additional 2,570 shares in the last quarter. 36.39% of the stock is owned by institutional investors.

ON Company Profile

On Holding AG, known as On, is a Swiss sportswear company that develops and sells performance footwear, apparel and accessories. The company is particularly recognized for its running shoes, which incorporate proprietary technologies such as CloudTec cushioning and Speedboard components designed to support comfort, responsiveness and energy return.

On serves athletes and consumers across categories including running, outdoor activities, training and everyday performance. Its products are sold through the company's direct-to-consumer channels, including its website and branded retail stores, as well as through a network of wholesale partners in markets around the world.

On was founded in 2010 in Switzerland by Olivier Bernhard, David Allemann and Caspar Coppetti.

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