On Holding (ONON - Free Report) closed the most recent trading day at $37.24, moving -1.09% from the previous trading session. The stock's performance was behind the S&P 500's daily gain of 0.89%. At the same time, the Dow added 0.74%, and the tech-heavy Nasdaq gained 1.29%.
Heading into today, shares of the running-shoe and apparel company had gained 3.98% over the past month, outpacing the Retail-Wholesale sector's gain of 1.33% and the S&P 500's loss of 0.63%.
Analysts and investors alike will be keeping a close eye on the performance of On Holding in its upcoming earnings disclosure. The company is forecasted to report an EPS of $0.43, showcasing a 490.91% upward movement from the corresponding quarter of the prior year. Meanwhile, the latest consensus estimate predicts the revenue to be $1.12 billion, indicating a 23.17% increase compared to the same quarter of the previous year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.77 per share and revenue of $4.51 billion. These totals would mark changes of +82.47% and +23.9%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for On Holding. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.75% increase. On Holding presently features a Zacks Rank of #3 (Hold).
Looking at valuation, On Holding is presently trading at a Forward P/E ratio of 21.33. Its industry sports an average Forward P/E of 16.53, so one might conclude that On Holding is trading at a premium comparatively.
Investors should also note that ONON has a PEG ratio of 0.6 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Retail - Apparel and Shoes industry had an average PEG ratio of 1.23 as trading concluded yesterday.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 62, which puts it in the top 26% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
On Holding (ONON - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Over the past month, shares of this running-shoe and apparel company have returned +4%, compared to the Zacks S&P 500 composite's -0.6% change. During this period, the Zacks Retail - Apparel and Shoes industry, which On Holding falls in, has lost 2.6%. The key question now is: What could be the stock's future direction?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
On Holding is expected to post earnings of $0.43 per share for the current quarter, representing a year-over-year change of +490.9%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
For the current fiscal year, the consensus earnings estimate of $1.77 points to a change of +82.5% from the prior year. Over the last 30 days, this estimate has changed +1.8%.
For the next fiscal year, the consensus earnings estimate of $2.15 indicates a change of +21.6% from what On Holding is expected to report a year ago. Over the past month, the estimate has changed +0.9%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for On Holding.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For On Holding, the consensus sales estimate for the current quarter of $1.12 billion indicates a year-over-year change of +23.2%. For the current and next fiscal years, $4.51 billion and $5.44 billion estimates indicate +23.9% and +20.7% changes, respectively.
Last Reported Results and Surprise HistoryOn Holding reported revenues of $1.06 billion in the last reported quarter, representing a year-over-year change of +31.4%. EPS of $0.47 for the same period compares with $0.23 a year ago.
Compared to the Zacks Consensus Estimate of $1.05 billion, the reported revenues represent a surprise of +0.86%. The EPS surprise was +34.29%.
Over the last four quarters, On Holding surpassed consensus EPS estimates three times. The company topped consensus revenue estimates each time over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
On Holding is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about On Holding. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
In the latest close session, On Holding (ONON - Free Report) was up +1.98% at $38.20. The stock's change was more than the S&P 500's daily loss of 0.51%. At the same time, the Dow lost 0.2%, and the tech-heavy Nasdaq lost 1.47%.
Heading into today, shares of the running-shoe and apparel company had lost 0.69% over the past month, lagging the Retail-Wholesale sector's gain of 0.51% and the S&P 500's gain of 0.53%.
Investors will be eagerly watching for the performance of On Holding in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.43, indicating a 490.91% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.12 billion, up 23.17% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $1.77 per share and revenue of $4.51 billion, indicating changes of +82.47% and +23.9%, respectively, compared to the previous year.
It is also important to note the recent changes to analyst estimates for On Holding. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 1.75% higher. On Holding presently features a Zacks Rank of #3 (Hold).
In the context of valuation, On Holding is at present trading with a Forward P/E ratio of 21.22. For comparison, its industry has an average Forward P/E of 15.67, which means On Holding is trading at a premium to the group.
Investors should also note that ONON has a PEG ratio of 0.59 right now. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Retail - Apparel and Shoes industry held an average PEG ratio of 1.24.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 68, which puts it in the top 28% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
On Holding (ONON - Free Report) closed the most recent trading day at $36.77, moving +1.07% from the previous trading session. The stock exceeded the S&P 500, which registered a gain of 0.81% for the day. On the other hand, the Dow registered a gain of 0.27%, and the technology-centric Nasdaq increased by 1.3%.
The stock of running-shoe and apparel company has fallen by 4.26% in the past month, lagging the Retail-Wholesale sector's gain of 0.24% and the S&P 500's gain of 1.13%.
Market participants will be closely following the financial results of On Holding in its upcoming release. The company is expected to report EPS of $0.44, up 500% from the prior-year quarter. Simultaneously, our latest consensus estimate expects the revenue to be $1.12 billion, showing a 23.83% escalation compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates project earnings of $1.77 per share and a revenue of $4.53 billion, demonstrating changes of +82.47% and +24.42%, respectively, from the preceding year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for On Holding. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.83% higher within the past month. On Holding is currently sporting a Zacks Rank of #1 (Strong Buy).
In terms of valuation, On Holding is presently being traded at a Forward P/E ratio of 20.51. This expresses a premium compared to the average Forward P/E of 16.12 of its industry.
Meanwhile, ONON's PEG ratio is currently 0.57. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Retail - Apparel and Shoes was holding an average PEG ratio of 1.18 at yesterday's closing price.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. Currently, this industry holds a Zacks Industry Rank of 53, positioning it in the top 22% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?
Let's take a look at what these Wall Street heavyweights have to say about On Holding (ONON - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
On Holding currently has an average brokerage recommendation (ABR) of 1.32, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 25 brokerage firms. An ABR of 1.32 approximates between Strong Buy and Buy.
Of the 25 recommendations that derive the current ABR, 21 are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 84% and 4% of all recommendations.
Brokerage Recommendation Trends for ONON
Check price target & stock forecast for On Holding here>>>
While the ABR calls for buying On Holding, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.
Zacks Rank Should Not Be Confused With ABRIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
On the other hand, earnings estimate revisions are at the core of the Zacks Rank. And empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Is ONON Worth Investing In?In terms of earnings estimate revisions for On Holding, the Zacks Consensus Estimate for the current year has increased 2.8% over the past month to $1.77.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #1 (Strong Buy) for On Holding. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for On Holding may serve as a useful guide for investors.
Growth stocks are attractive to many investors, as above-average financial growth helps these stocks easily grab the market's attention and produce exceptional returns. But finding a growth stock that can live up to its true potential can be a tough task.
By their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss.
However, the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company's real growth prospects, makes it pretty easy to find cutting-edge growth stocks.
On Holding (ONON - Free Report) is one such stock that our proprietary system currently recommends. The company not only has a favorable Growth Score, but also carries a top Zacks Rank.
Studies have shown that stocks with the best growth features consistently outperform the market. And returns are even better for stocks that possess the combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy).
Here are three of the most important factors that make the stock of this running-shoe and apparel company a great growth pick right now.
Earnings GrowthArguably nothing is more important than earnings growth, as surging profit levels is what most investors are after. And for growth investors, double-digit earnings growth is definitely preferable, and often an indication of strong prospects (and stock price gains) for the company under consideration.
While the historical EPS growth rate for On Holding is 64.3%, investors should actually focus on the projected growth. The company's EPS is expected to grow 82.8% this year, crushing the industry average, which calls for EPS growth of 17.4%.
Cash Flow GrowthCash is the lifeblood of any business, but higher-than-average cash flow growth is more beneficial and important for growth-oriented companies than for mature companies. That's because, high cash accumulation enables these companies to undertake new projects without raising expensive outside funds.
Right now, year-over-year cash flow growth for On Holding is 2.7%, which is higher than many of its peers. In fact, the rate compares to the industry average of -2.4%.
While investors should actually consider the current cash flow growth, it's worth taking a look at the historical rate too for putting the current reading into proper perspective. The company's annualized cash flow growth rate has been 90% over the past 3-5 years versus the industry average of 14.2%.
Promising Earnings Estimate RevisionsSuperiority of a stock in terms of the metrics outlined above can be further validated by looking at the trend in earnings estimate revisions. A positive trend is of course favorable here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
There have been upward revisions in current-year earnings estimates for On Holding. The Zacks Consensus Estimate for the current year has surged 2.8% over the past month.
Bottom LineWhile the overall earnings estimate revisions have made On Holding a Zacks Rank #1 stock, it has earned itself a Growth Score of A based on a number of factors, including the ones discussed above.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
This combination positions On Holding well for outperformance, so growth investors may want to bet on it.
On Holding (ONON - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Over the past month, shares of this running-shoe and apparel company have returned -0.7%, compared to the Zacks S&P 500 composite's +2.1% change. During this period, the Zacks Retail - Apparel and Shoes industry, which On Holding falls in, has lost 0.3%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
On Holding is expected to post earnings of $0.44 per share for the current quarter, representing a year-over-year change of +500%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The consensus earnings estimate of $1.77 for the current fiscal year indicates a year-over-year change of +82.5%. This estimate has remained unchanged over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $2.16 indicates a change of +21.7% from what On Holding is expected to report a year ago. Over the past month, the estimate has changed +1.4%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, On Holding is rated Zacks Rank #2 (Buy).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.
In the case of On Holding, the consensus sales estimate of $1.13 billion for the current quarter points to a year-over-year change of +24.2%. The $4.53 billion and $5.46 billion estimates for the current and next fiscal years indicate changes of +24.4% and +20.7%, respectively.
Last Reported Results and Surprise HistoryOn Holding reported revenues of $1.06 billion in the last reported quarter, representing a year-over-year change of +31.4%. EPS of $0.47 for the same period compares with $0.23 a year ago.
Compared to the Zacks Consensus Estimate of $1.05 billion, the reported revenues represent a surprise of +0.86%. The EPS surprise was +34.29%.
Over the last four quarters, On Holding surpassed consensus EPS estimates three times. The company topped consensus revenue estimates each time over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
On Holding is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about On Holding. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
On Holding (ONON - Free Report) ended the recent trading session at $37.07, demonstrating a +1.34% change from the preceding day's closing price. The stock exceeded the S&P 500, which registered a loss of 0.05% for the day. Meanwhile, the Dow experienced a drop of 0.09%, and the technology-dominated Nasdaq saw a decrease of 0.24%.
The running-shoe and apparel company's shares have seen a decrease of 7.97% over the last month, not keeping up with the Retail-Wholesale sector's loss of 7.87% and the S&P 500's loss of 1.42%.
The investment community will be closely monitoring the performance of On Holding in its forthcoming earnings report. It is anticipated that the company will report an EPS of $0.43, marking a 490.91% rise compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $1.13 billion, showing a 24.26% escalation compared to the year-ago quarter.
For the full year, the Zacks Consensus Estimates are projecting earnings of $1.75 per share and revenue of $4.53 billion, which would represent changes of +80.41% and +24.54%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for On Holding. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. On Holding is currently sporting a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that On Holding has a Forward P/E ratio of 20.9 right now. This signifies a premium in comparison to the average Forward P/E of 15.96 for its industry.
Investors should also note that ONON has a PEG ratio of 0.6 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Retail - Apparel and Shoes industry had an average PEG ratio of 1.29.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 77, which puts it in the top 32% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ONON in the coming trading sessions, be sure to utilize Zacks.com.
On Holding is transitioning from a pure running brand to a luxury lifestyle brand, expanding its TAM and reinforcing premium pricing power. ONON's moat is driven by innovation—LightSpray and SURREAL Superfoam technologies—enabling margin expansion and brand differentiation, with Q1 2026 gross margin reaching 64%. Q1 2026 results showed 26% YoY revenue growth and operating margin expansion to 14.1%, with management prioritizing premium brand value over volume.
In the latest close session, On Holding (ONON - Free Report) was down 6.87% at $36.21. The stock's performance was behind the S&P 500's daily loss of 0.37%. Meanwhile, the Dow experienced a rise of 0.29%, and the technology-dominated Nasdaq saw a decrease of 1.33%.
The running-shoe and apparel company's shares have seen a decrease of 2.34% over the last month, surpassing the Retail-Wholesale sector's loss of 4.65% and falling behind the S&P 500's gain of 2.02%.
Market participants will be closely following the financial results of On Holding in its upcoming release. On that day, On Holding is projected to report earnings of $0.42 per share, which would represent year-over-year growth of 481.82%. Meanwhile, our latest consensus estimate is calling for revenue of $1.13 billion, up 24.26% from the prior-year quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.73 per share and revenue of $4.53 billion. These totals would mark changes of +78.35% and +24.54%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for On Holding. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Right now, On Holding possesses a Zacks Rank of #3 (Hold).
Looking at valuation, On Holding is presently trading at a Forward P/E ratio of 22.44. This represents a premium compared to its industry average Forward P/E of 16.63.
Meanwhile, ONON's PEG ratio is currently 0.64. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Retail - Apparel and Shoes industry had an average PEG ratio of 1.35.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 82, this industry ranks in the top 34% of all industries, numbering over 250.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
Investors might want to bet on On Holding (ONON - Free Report) , as it has been recently upgraded to a Zacks Rank #2 (Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.
The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.
Individual investors often find it hard to make decisions based on rating upgrades by Wall Street analysts, since these are mostly driven by subjective factors that are hard to see and measure in real time. In these situations, the Zacks rating system comes in handy because of the power of a changing earnings picture in determining near-term stock price movements.
Therefore, the Zacks rating upgrade for On Holding basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price.
Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, has proven to be strongly correlated with the near-term price movement of its stock. The influence of institutional investors has a partial contribution to this relationship, as these big professionals use earnings and earnings estimates to calculate the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.
Fundamentally speaking, rising earnings estimates and the consequent rating upgrade for On Holding imply an improvement in the company's underlying business. Investors should show their appreciation for this improving business trend by pushing the stock higher.
Harnessing the Power of Earnings Estimate RevisionsEmpirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, so it could be truly rewarding if such revisions are tracked for making an investment decision. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>> .
Earnings Estimate Revisions for On HoldingThis running-shoe and apparel company is expected to earn $1.75 per share for the fiscal year ending December 2026, which represents no year-over-year change.
Analysts have been steadily raising their estimates for On Holding. Over the past three months, the Zacks Consensus Estimate for the company has increased 5.4%.
Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of "buy" and "sell" ratings for its entire universe of more than 4,000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a "Strong Buy" rating and the next 15% get a "Buy" rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of On Holding to a Zacks Rank #2 positions it in the top 20% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
On Holding (ONON - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Over the past month, shares of this running-shoe and apparel company have returned -12.9%, compared to the Zacks S&P 500 composite's -1.3% change. During this period, the Zacks Retail - Apparel and Shoes industry, which On Holding falls in, has gained 0.4%. The key question now is: What could be the stock's future direction?
While media releases or rumors about a substantial change in a company's business prospects usually make its stock 'trending' and lead to an immediate price change, there are always some fundamental facts that eventually dominate the buy-and-hold decision-making.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, On Holding is expected to post earnings of $0.43 per share, indicating a change of +490.9% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The consensus earnings estimate of $1.75 for the current fiscal year indicates a year-over-year change of +80.4%. This estimate has remained unchanged over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $2.12 indicates a change of +21.3% from what On Holding is expected to report a year ago. Over the past month, the estimate has changed -0.5%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, On Holding is rated Zacks Rank #2 (Buy).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of On Holding, the consensus sales estimate of $1.13 billion for the current quarter points to a year-over-year change of +24.3%. The $4.53 billion and $5.46 billion estimates for the current and next fiscal years indicate changes of +24.5% and +20.5%, respectively.
Last Reported Results and Surprise HistoryOn Holding reported revenues of $1.06 billion in the last reported quarter, representing a year-over-year change of +31.4%. EPS of $0.47 for the same period compares with $0.23 a year ago.
Compared to the Zacks Consensus Estimate of $1.05 billion, the reported revenues represent a surprise of +0.86%. The EPS surprise was +34.29%.
Over the last four quarters, On Holding surpassed consensus EPS estimates three times. The company topped consensus revenue estimates each time over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
On Holding is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about On Holding. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts often affect a stock's price, do they really matter?
Let's take a look at what these Wall Street heavyweights have to say about On Holding (ONON - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
On Holding currently has an average brokerage recommendation (ABR) of 1.42, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 24 brokerage firms. An ABR of 1.42 approximates between Strong Buy and Buy.
Of the 24 recommendations that derive the current ABR, 19 are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 79.2% and 4.2% of all recommendations.
Brokerage Recommendation Trends for ONON
Check price target & stock forecast for On Holding here>>>
The ABR suggests buying On Holding, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Are you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.
ABR Should Not Be Confused With Zacks RankAlthough both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
On the other hand, earnings estimate revisions are at the core of the Zacks Rank. And empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
There is also a key difference between the ABR and Zacks Rank when it comes to freshness. When you look at the ABR, it may not be up-to-date. Nonetheless, since brokerage analysts constantly revise their earnings estimates to reflect changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in predicting future stock prices.
Should You Invest in ONON?In terms of earnings estimate revisions for On Holding, the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $1.73.
Analysts' steady views regarding the company's earnings prospects, as indicated by an unchanged consensus estimate, could be a legitimate reason for the stock to perform in line with the broader market in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for On Holding. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
It may therefore be prudent to be a little cautious with the Buy-equivalent ABR for On Holding.
On Holding AG (NYSE:ONON) will release earnings for its first quarter before the opening bell on Tuesday, May 12.
Analysts expect the Zurich, Switzerland-based company to report quarterly earnings of 27 cents per share, up from 21 cents per share in the year-ago period. The consensus estimate for On Holding's quarterly revenue is $821.52 million (it reported $726.6 million last year), according to Benzinga Pro.
On March 25, On Holding named co-founders David Allemann and Caspar Coppetti as co-CEOs and promoted Scott Maguire to president and COO.
Shares of On Holding fell 3.4% to close at $34.04 on Monday.
Benzinga readers can access the latest analyst ratings on the Analyst Stock Ratings page. Readers can sort by stock ticker, company name, analyst firm, rating change or other variables.
Let's have a look at how Benzinga's most-accurate analysts have rated the company in the recent period.
Considering buying ONON stock? Here’s what analysts think:
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Item 1 of 2 Cast member Zendaya attends a premiere for the television series "Euphoria" in Los Angeles, California, U.S., April 7, 2026. REUTERS/Mario Anzuoni/File Photo
[1/2]Cast member Zendaya attends a premiere for the television series "Euphoria" in Los Angeles, California, U.S., April 7, 2026. REUTERS/Mario Anzuoni/File Photo Purchase Licensing Rights, opens new tab
SummaryCompaniesOn raises profitability forecast thanks to new sneaker salesZendaya collaboration attracting younger women to On brandMay 12 (Reuters) - Sportswear brand On (49G.BN), opens new tab raised its profit margin forecast on Tuesday after strong first-quarter sales, as the Swiss company continues to gain ground in the sneaker and running shoe market long dominated by Nike and Adidas.
With Euphoria and Dune star Zendaya as a brand ambassador, co-CEO Caspar Coppetti said On is targeting younger, female consumers, adding that a clothing range launched with the 29-year-old actor is performing well.
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"In terms of the long-term growth, what we're trying to do with apparel or on the sneaker side, we see early very encouraging signs from that," Coppetti told Reuters.
First-quarter sales grew 26.4% to 831.9 million Swiss francs ($1.07 billion) in currency-adjusted terms, beating analysts' average forecast of 822.5 million francs in LSEG-compiled data.
On now expects an operating profit margin of between 19.5% and 20% for 2026, up from 18.5% to 19% previously, and a gross profit margin of at least 64.5%. It maintained its target of at least 23% sales growth this year.
On was managing inflationary costs "very well" and could stand to benefit further from U.S. tariff refunds, said Rick Patel, analyst at Raymond James.
U.S.-listed On shares reversed premarket gains to fall about 4% in early trading as analysts highlighted a slowing rate of growth in the United States.
Sales in the Americas - accounting for more than half of On's revenue - rose 17.1% in the quarter, compared with a 28.6% gain a year ago.
Asia-Pacific was the strongest region, with 61.4% sales growth, as On expands in China and South Korea.
Jefferies analysts said On's management is emphasising growth in Asia, but warned a slowing growth rate in the U.S. risks ending its margin outperformance in the longer term.
STRONG LAUNCHES BOOST MARGINSCoppetti said profitability was helped by successful new launches, with Cloudtilt sneakers - retailing at between 170 euros and 190 euros - the best-selling shoe across Foot Locker Europe in March. On's operating profit margin rose to 21% in the first quarter, from 16.5% a year ago.
On has changed its senior leadership, with co-founders David Allemann and Caspar Coppetti taking over as joint CEOs on May 1, when Frank Sluis, previously at supermarket group Ahold Delhaize, also joined as chief financial officer.
On's share price is near its lowest levels in two years, having fallen more than 20% since the start of 2026 as the energy price shock triggered by the Iran war dents consumer confidence in the U.S. and Europe.
Share price of On since its IPO in September 2021($1 = 0.7797 Swiss francs)
Reporting by Helen Reid in London and Juveria Tabassum in Bengaluru, Editing by Louise Heavens and Alexander Smith
Our Standards: The Thomson Reuters Trust Principles., opens new tab
London-based reporter covering the European retail sector through a global lens. Focusing on companies including Adidas, H&M, Ikea, and Inditex and analysing corporate strategy, consumer trends, and regulatory changes, Helen also covers major supermarket groups like Ahold Delhaize, Carrefour, and Casino. She has a special interest in sustainability and how investors push for change in companies. Previously based in Johannesburg where she covered the mining industry.
1. ONON Pops 5% as Premium Push Pays Off On Holding (ONON +3.10%) rose over 5% ahead of the opening bell after results showed record net sales and profitability, driven by a 44.4% revenue growth in the APAC region versus the previous year, as well as lifting its full-year profit outlook.
"Q1 was an outstanding start to the year and another strong proof point of our premium strategy in action": Casper Coppetti, founder and co-CEO, emphasized the push to being a premium brand, with the Stock Advisor recommendation by Team Rule Breakers projecting an impressive 64.5% gross profit margin by year end. "The business is doing fine": In late March, TMF chief investment officer Andy Cross explained, "even though they continue to put up some good numbers, they have some of the bigger headwinds from spending and tariffs and margins," but flagged the business had been "a long-term performer." 2. OpenAI Caps Microsoft Revenue Share The Information reports Microsoft (MSFT 1.75%) and OpenAI have agreed to cap revenue-sharing payments at $38 billion as details emerge of the renegotiated contract from last month, allowing OpenAI to have a stronger pitch to take on new investors.
Revenue-sharing will continue through to 2030: Even though the contract obligates payments for the coming years, the cap makes OpenAI more attractive when considering an IPO later this year, as it puts the company more in control of its finances. "It has worked out well because we took the risk": Microsoft CEO Satya Nadella said he was proud of the early investment in the business, with the initial $13 billion stake estimated to be worth $92 billion. 3. Inference Shift Triggers CPU Boost Chip processor makers including Advanced Micro Devices (AMD +7.97%) and Intel (INTC +9.34%) closed higher yesterday after GlobalFoundries (GFS +7.91%) announced the CPU market is entering a growth "super cycle."
CPUs becoming more key as AI workloads shift toward inference: The AI training phase used to have a ratio of 8:1 for GPUs to CPUs. However, as inference and agentic AI becomes more popular, this ratio has dropped to 4:1 and could fall further. AMD and Intel expected to be near-term winners: The current chip offerings from certain companies makes them best placed for the workload shift. AMD is beating the S&P 500 by 120% since the January 2024 SA rec from Team Rule Breakers. Qualcomm (QCOM +6.09%) was also noted as a potential long-term winner as it expands into data center CPUs. 4. Selected Stock Advisor Pre-Market Earnings JD.com (JD 1.37%) rose by 2.5% in pre-market trading as quarterly net revenue increased by 4.9% versus the same period last year, with CEO Sandy Xu saying "our user base and shopping frequency continued to expand robustly, with annual active customers hitting a new record." Under Armour (UA +5.24%) releases earnings before the opening bell, with a focus on the North America turnaround and potential trade headwinds for the stock, recommended by both Team Rule Breakers and Team Hidden Gems Zebra Technologies (ZBRA +2.61%) surged almost 15% in early trade, reporting a 14.3% year-over-year revenue increase to $1.49 billion. The Team Rule Breakers rec also saw a significant boost in profitability, with non-GAAP diluted earnings per share climbing to $4.75 and adjusted EBITDA reaching $347 million. 5. Your Take When a stock you own has been moving in the opposite direction of the S&P 500 for over a year – you're down while the market's up – what do you do? Hold, add, or sell? What goes through your mind when making that call?
Discuss with friends and family, or become a member to hear what your fellow Fools are saying!
This image and article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, GlobalFoundries, Intel, Microsoft, On Holding, Qualcomm, and Zebra Technologies. The Motley Fool recommends JD.com and Under Armour. The Motley Fool has a disclosure policy.
On Holding (ONON - Free Report) came out with quarterly earnings of $0.47 per share, beating the Zacks Consensus Estimate of $0.35 per share. This compares to earnings of $0.23 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents an earnings surprise of +32.77%. A quarter ago, it was expected that this running-shoe and apparel company would post earnings of $0.26 per share when it actually produced earnings of $0.31, delivering a surprise of +19.23%.
Over the last four quarters, the company has surpassed consensus EPS estimates three times.
On Holding, which belongs to the Zacks Retail - Apparel and Shoes industry, posted revenues of $1.06 billion for the quarter ended March 2026, surpassing the Zacks Consensus Estimate by 0.86%. This compares to year-ago revenues of $808.1 million. The company has topped consensus revenue estimates four times over the last four quarters.
The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.
On Holding shares have lost about 26.8% since the beginning of the year versus the S&P 500's gain of 8.3%.
What's Next for On Holding?While On Holding has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?
There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.
Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this earnings release, the estimate revisions trend for On Holding was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.42 on $1.13 billion in revenues for the coming quarter and $1.64 on $4.53 billion in revenues for the current fiscal year.
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Retail - Apparel and Shoes is currently in the bottom 36% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
Another stock from the same industry, American Eagle Outfitters (AEO - Free Report) , has yet to report results for the quarter ended April 2026. The results are expected to be released on May 28.
This teen clothing retailer is expected to post quarterly earnings of $0.11 per share in its upcoming report, which represents a year-over-year change of +137.9%. The consensus EPS estimate for the quarter has been revised 0.7% lower over the last 30 days to the current level.
American Eagle Outfitters' revenues are expected to be $1.18 billion, up 8.5% from the year-ago quarter.
This is a fair market value price provided by Massive. Learn more.
52-Week Range$31.41▼
$56.81P/E Ratio42.13
Price Target$55.05
On Holdings’ NYSE: ONON share price has its share of headwinds, including macroeconomic pressures, a surprise CEO change, FX conversion, and slowing growth, but these are priced into the market. While headwinds remain, the company continues to perform well, sustaining a high growth pace and widening margins in a world with share for the taking.
Its biggest competitor is Nike NYSE: NKE, and Nike is a long way from reclaiming its lost glory. The takeaway for ONON investors is that the stock trades at a significant discount to its outlook, an outlook that was juiced by its May guidance update, suggesting triple-digit upside for patient investors.
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ONON Stock Poised for Significant Near-Term UpsideBetween now and then, there is a substantial near-to mid-term opportunity as well. The company not only trades at a discount to its forward outlook, a low-ball estimate, but to its competitor, suggesting price multiple expansion now and over the long-term. Additionally, analysts remain committed to this name, providing a solid support base for accumulating shares. Data tracked by MarketBeat reveals 19 current ratings, a Moderate Buy consensus, and a 79% Buy-side bias.
The price target is the operational detail following the Q1 2026 earnings report, forecasting more than 70% upside from the critical support level. As it stands, the price target has been steady on a trailing 12-month basis (TTM) and is unlikely to change significantly without a change in the outlook. The critical support level is near April lows, just below $32, and is likely to be tested.
Institutional data suggest that support at the critical level is strong and a rebound from there is likely. The institutional group owns only 37% of the stock but has been aggressively accumulating it over the TTM. The data reveals them buying at a nearly $2-to-$1 pace, with activity ramping sequentially to a record high in Q1 2026. The pace remained bullish in early Q2 and will likely remain so given the value proposition. The biggest risk from the sell-side is the insiders, but even that isn’t alarming. Ex-CEO Martin Hoffmann is exiting his stake as part of a prearranged plan triggered by his departure; aside from that, insiders, including the founders/co-CEOs, hold a significant stake and aren’t selling.
On Holdings Raises Profit Guidance After Hot QuarterOn Holdings had a solid Q1 report, with revenue growing by 14.5% year-over-year (YOY), 26.4% on a forex-neutral (FXN) basis, with strength across all channels, geos, and product lines. DTC, the higher-margin segment, grew by 16.4% and 28.7% FXN, while Wholesale grew by 13.3% and 25.1% FXN, with both underpinned by strength in Asia-Pacific (APAC) and Apparel.
Regionally, APAC led with gains of 44.4% and 61.4%, followed by 25.6% FXN increase in Europe, the Middle East, and Africa, and a 13.3% FXN gain in the Americas. Regarding the product channels, the core shoe segment grew by 12.2%, 24% FXN, while Apparel grew by 57.5% FXN to 20% of the business, and Accessories grew by 86.6%.
Margin news was also strong. The company logged improvements at the gross, EBITDA, and net income levels on both a GAAP and an adjusted basis. GAAP and adjusted earnings increased by 82% and 76%, respectively, both ahead of consensus and the impact of Q1 strengths on the outlook. The company cited operational strength and execution as drivers of margin, reaffirming the revenue forecast and raising the full-year margin outlook.
Executives expect an adjusted EBITDA margin in the 19.5% to 20% range, a full 100 bps better than the previous guide, and the revenue outlook is likely cautious. Either way, the revenue guide forecasts a YOY slowdown in growth, but sequential acceleration through year’s end.
On Holdings: A Solid Brand With Catalysts AheadWhile the company’s headwinds are unlikely to ease, including uncertainty and tariff-related cost pressures, there are catalysts in place to drive outperformance. They include strength in DTC, APAC, and Apparel, as well as the LightSpray innovation. It enables rapid, wasteless, automated shoe construction, paving the way to significant margin improvement and operating efficiencies. It uses a robotic arm to spray a mile-long filament onto a shoe mold, which instantly hardens into a laceless upper.
The strength of On Holdings' business and brand is reflected in the balance sheet highlights. The company increased its cash, working capital, current, and total assets while reducing total liabilities. Equity improved by 8.5% on a year-to-date basis and will likely continue increasing as the year progresses.
Should You Invest $1,000 in ON Right Now?Before you consider ON, you'll want to hear this.
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On Holding AG reported good Q1 results. Growth remained good across sales channels, markets, and product categories. Expansion in China and increased sales of apparel and accessories present clear long-term growth potential for ONON. Profitability has gained from ONON's strong brand power, leading to a 2026 EBITDA guidance raise.
On Holding is rated Buy with a $46 twelve-month price target, offering 29% upside from current levels. ONON's premium brand, 63% gross margins, and DTC sales nearing 50% of revenue underpin its high-quality growth profile. Recent stock weakness stems from softer FY2026 guidance, CEO departure, and tariff concerns, but fundamentals remain robust.
An analyst firm is stepping back on price, but not on conviction. KeyBanc lowered its price target on On Holding to $43 from $58 while keeping its Overweight rating, framing the move as a recalibration tied to tariff exposure rather than a break in the long-term growth thesis. For investors weighing the premium athletic name, the message is mixed: near-term headwinds are real, but the underlying brand momentum still has Wall Street’s attention.
The price target cut on On Holding (NYSE:ONON | ONON Price Prediction) lands one day after the Swiss footwear brand delivered a sizable Q1 2026 beat. ONON stock closed at $33.83 on May 12, and the shares are down about 27% year to date (YTD).
Ticker Company Firm Action Old Rating New Rating Old Target New Target ONON On Holding KeyBanc Price Target Cut Overweight Overweight $58 $43 The Analyst’s Case KeyBanc’s reset reflects tariff-related cost pressure rather than a deteriorating brand. The firm continues to view On Holding’s reiterated 23%-plus constant currency growth guidance as conservative if current demand trends persist. That language is unusually bullish for a downgrade-in-target call.
The other nuance is potential tariff relief. KeyBanc flagged that tariff refunds could serve as incremental upside if and when they materialize, a scenario On Holding’s own guidance explicitly excludes.
Company Snapshot On Holding is a premium Swiss sportswear brand competing with Hoka, Nike (NYSE:NKE), and other performance labels in running and lifestyle. On Holding’s Q1 2026 revenue came in at $1.07 billion, beating estimates by 22%, with gross margin of 64%.
Asia-Pacific is the standout, with revenue up 44% year-over-year. On Holding also disclosed approximately $70.43 million in IEEPA tariffs absorbed during the quarter, with co-founders David Allemann and Caspar Coppetti stepping back in as Co-CEOs.
Why the Move Matters Now Tariff exposure is the central issue. Roughly 90% of On Holding’s footwear and 65% of apparel are sourced from Vietnam, and the company’s full-year outlook embeds a 20% incremental tariff rate on Vietnam imports.
The valuation backdrop also matters. ONON stock trades at a forward P/E ratio of 24x, with a consensus analyst target of $56.42. KeyBanc’s $43 marks one of the more cautious Street views, though the Overweight tag keeps the firm in the bull camp.
What It Means for Your Portfolio For prudent investors, KeyBanc’s call captures both sides of the On Holding stock debate. The bull case rests on premium pricing power, accelerating Asia-Pacific growth, and apparel revenue that rose 45%. Customers paying $150 to $200 for performance shoes tend to absorb tariff pass-through better than mass-market buyers.
The On Holding bear case rests on Vietnam concentration, a beta of 2.087 that has translated into sharp drawdowns, and growth deceleration from 36% in 2025 to a guided 23%-plus this year. The Overweight rating signals that KeyBanc sees this as a near-term recalibration, not a thesis change, leaving moderate position sizing as a sensible posture while tariff clarity develops.
On Holding shares have declined ~30% YTD despite robust Q1 sales growth and a raised full-year profit outlook. ONON is capturing market share with near-30% constant currency growth, outpacing flat revenue at Nike in a mature sportswear category. Gross margins remain in the mid-60s, reflecting premium positioning and resilience to tariffs, while Asia revenue growth outpaces core U.S. and Europe markets.
On Holdings Sets Up for Marathon Rally: New Highs Are ComingON NYSE: ONON reported what executives described as an “outstanding” start to 2026, with first-quarter net sales surpassing CHF 800 million for the first time and profitability expanding as the company reiterated its full-year growth outlook.
Net sales reached CHF 831.9 million in the quarter, up 26.4% year over year on a constant currency basis and 14.5% on a reported basis, according to outgoing CEO and CFO Martin Hoffmann. The company also reported a gross profit margin of 64.2%, up from 59.9% in the prior-year period, and an adjusted EBITDA margin of 21%, up 450 basis points year over year.
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Down 75% From Its High, How Much Lower Can Nike Get?Founder and co-CEO Caspar Coppetti said the results reflected “broad-based” demand across regions, product categories and channels, citing double-digit constant currency growth in the Americas, EMEA and APAC, as well as apparel growth of more than 50% globally.
Regional and Channel Growth Remains Broad-Based Hoffmann said direct-to-consumer sales reached CHF 322.3 million, growing 28.7% at constant currency and 16.4% on a reported basis. He said digital and physical traffic is growing faster than revenue, which he characterized as a sign that demand is ahead of current conversion.
After Cooling Off, On Holding May Be Ready to Sprint HigherWholesale net sales exceeded CHF 500 million for the first time, reaching CHF 509.6 million. That represented growth of 25.1% at constant currency and 13.3% on a reported basis. Hoffmann said On continues to see momentum with key accounts including Dick’s Sporting Goods, Foot Locker and JD Sports, while noting the company is present in only about half of stores with those major partners.
By region, the Americas generated CHF 450.7 million in net sales, up 17.1% at constant currency but only 3.1% on a reported basis due to foreign exchange headwinds. EMEA net sales rose to CHF 207.1 million, growing 25.6% at constant currency, marking the sixth consecutive quarter of more than 25% constant currency growth in the region. APAC net sales reached CHF 174 million, up 61.4% at constant currency, and exceeded 20% of the company’s total business for the first time.
Hoffmann highlighted Greater China as growing well above the APAC average and said South Korea’s net sales more than tripled year over year.
Footwear Leads, Apparel Gains Share Footwear remained On’s largest category, with net sales of CHF 763.7 million, up 24% at constant currency. Hoffmann cited continued strength from major franchises, including Cloudmonster, as well as newer products such as Cloudzone, which he said grew more than 350% in volume from a low base.
Apparel net sales reached CHF 55.3 million, rising 57.5% at constant currency and 45.1% on a reported basis. Hoffmann said apparel contributed more than 10% of direct-to-consumer sales for the first time and is becoming a more important entry point for the brand.
Coppetti pointed to lifestyle products such as Cloudtilt and Cloudtilt Remix as drivers of growth with younger consumers. He said Cloudtilt became the top seller at Foot Locker Europe “by wide margin” in March. He also cited recent collaborations and campaigns, including a Cloudswift relaunch with Kith and a female-led head-to-toe launch with Zendaya, as efforts to expand the brand’s cultural relevance while maintaining premium positioning.
Innovation Pipeline Includes LightSpray and SURREAL Executives placed significant emphasis on On’s product innovation pipeline. Coppetti said LightSpray, the company’s robotic upper-manufacturing technology, is moving from a performance proof point toward a commercial engine. He said On increased LightSpray production capacity thirtyfold in February with the opening of a factory in Busan, South Korea.
Coppetti said the LightSpray Cloudmonster Hyper sold out quickly across many channels, with particularly strong demand in Asia Pacific and the U.S. During the opening week of On’s new Boston store, LightSpray represented close to 20% of footwear net sales, and the company is selling several hundred pairs per day through direct-to-consumer channels alone, he said.
The company also discussed SURREAL, a superfoam technology expected to debut with Cloudsurfer 3 in October and roll out across key everyday running franchises in 2027. Coppetti said SURREAL weighs roughly half as much as industry-standard EVA while providing 60% to 70% more energy return.
Leadership Transition and Strategy The call also marked Hoffmann’s final earnings call as CEO and CFO. Coppetti thanked him for 13 years with the company and said Hoffmann will continue to support On as an adviser into next year. Frank Sluis, who became CFO on May 1, said he plans to build on the company’s financial foundation while supporting long-term growth and preserving the brand’s premium economics.
Coppetti and co-founder David Allemann are continuing as co-CEOs. In response to an analyst question, Coppetti said the management transition is intended to provide continuity, adding that the company is not changing its strategy, values or premium positioning.
When asked about the risk of driving growth by lowering prices, Coppetti said On’s ambition is not to build the largest company, but “the most desirable, most beautiful, most sustainable, most performant, most innovative company.” Hoffmann added that the company sees multiple growth trajectories in footwear, apparel, global expansion, lifestyle and retail that can be pursued in a premium way.
Guidance Reaffirmed, Profit Outlook Raised On reiterated its full-year constant currency net sales growth guidance of at least 23%. Based on current spot rates, the company said that would translate to reported net sales of CHF 3.51 billion. Executives said they continue to expect direct-to-consumer, APAC and apparel to outperform.
The company now expects a full-year gross profit margin of at least 64.5%, despite additional tariff pressure. Coppetti said the outlook assumes 20% incremental tariff rates from Vietnam and excludes any potential refunds. On also raised its adjusted EBITDA margin outlook to a range of 19.5% to 20%.
Hoffmann said marketing expenses are expected to be between 13% and 13.5% of sales for the full year, reflecting investments in brand-building, Zendaya-related activity, LightSpray activations and media aimed at reaching newer communities.
During the question-and-answer session, executives said the company remains encouraged by U.S. demand, with U.S. brand awareness crossing 30% for the first time. Coppetti said On is reaching younger and more female consumers, while Allemann said direct-to-consumer demand remains healthy and full-price oriented.
On said it will host an Investor Day in Zurich on September 21 and 22, 2026, where it plans to present its next phase of strategy and a new 2030 vision.
About ON NYSE: ONONOn Holding AG, commonly known as On, is a Swiss performance footwear and apparel company headquartered in Zurich. Founded in 2010, the company designs, develops and sells running shoes, performance apparel and accessories for road, trail and everyday use. On’s product philosophy centers on engineered cushioning and responsiveness intended to serve both serious athletes and lifestyle consumers.
On is best known for its proprietary midsole technology and distinctive sole architecture, marketed under names such as the Cloud family of shoes and related performance lines.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].
Should You Invest $1,000 in ON Right Now?Before you consider ON, you'll want to hear this.
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On Holding delivered strong Q1 '26 results, and management raised gross margin and EBITDA margin guidance for FY26. ONON's Asia-Pacific net sales surged 61% CC, highlighting APAC as a key growth catalyst. Gross margin reached 64.2%, and adjusted EBITDA margin hit 21%, both exceeding guidance and consensus.
On Holding (ONON - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Over the past month, shares of this running-shoe and apparel company have returned +0.8%, compared to the Zacks S&P 500 composite's +5.6% change. During this period, the Zacks Retail - Apparel and Shoes industry, which On Holding falls in, has lost 9.2%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, On Holding is expected to post earnings of $0.42 per share, indicating a change of +481.8% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.5% over the last 30 days.
For the current fiscal year, the consensus earnings estimate of $1.66 points to a change of +71.1% from the prior year. Over the last 30 days, this estimate has changed -0.4%.
For the next fiscal year, the consensus earnings estimate of $2.1 indicates a change of +26.3% from what On Holding is expected to report a year ago. Over the past month, the estimate has remained unchanged.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, On Holding is rated Zacks Rank #4 (Sell).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of On Holding, the consensus sales estimate of $1.13 billion for the current quarter points to a year-over-year change of +24.3%. The $4.53 billion and $5.48 billion estimates for the current and next fiscal years indicate changes of +24.5% and +21%, respectively.
Last Reported Results and Surprise HistoryOn Holding reported revenues of $1.06 billion in the last reported quarter, representing a year-over-year change of +31.4%. EPS of $0.47 for the same period compares with $0.23 a year ago.
Compared to the Zacks Consensus Estimate of $1.05 billion, the reported revenues represent a surprise of +0.86%. The EPS surprise was +34.29%.
Over the last four quarters, On Holding surpassed consensus EPS estimates three times. The company topped consensus revenue estimates each time over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
On Holding is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about On Holding. However, its Zacks Rank #4 does suggest that it may underperform the broader market in the near term.
Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts often affect a stock's price, do they really matter?
Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about On Holding (ONON - Free Report) .
On Holding currently has an average brokerage recommendation (ABR) of 1.42, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 24 brokerage firms. An ABR of 1.42 approximates between Strong Buy and Buy.
Of the 24 recommendations that derive the current ABR, 19 are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 79.2% and 4.2% of all recommendations.
Brokerage Recommendation Trends for ONON
Check price target & stock forecast for On Holding here>>>
While the ABR calls for buying On Holding, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.
ABR Should Not Be Confused With Zacks RankIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
Analysts employed by brokerage firms have been and continue to be overly optimistic with their recommendations. Since the ratings issued by these analysts are more favorable than their research would support because of the vested interest of their employers, they mislead investors far more often than they guide.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
In addition, the different Zacks Rank grades are applied proportionately to all stocks for which brokerage analysts provide current-year earnings estimates. In other words, this tool always maintains a balance among its five ranks.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Is ONON Worth Investing In?In terms of earnings estimate revisions for On Holding, the Zacks Consensus Estimate for the current year has declined 0.4% over the past month to $1.66.
Analysts' growing pessimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates lower, could be a legitimate reason for the stock to plunge in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #4 (Sell) for On Holding. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, it could be wise to take the Buy-equivalent ABR for On Holding with a grain of salt.
The S&P 500 continues to hit new highs, and it's becoming alarmingly expensive. The cyclically adjusted P/E ratio, or CAPE ratio, recently hit its second-highest level ever, and its highest rate since the market crashed in 2000.
There are reasons this time might be different, but there's no ignoring that it's getting harder to find bargains in the market. If you have $1,000 to invest today and are looking for stocks on sale, Target (TGT +3.61%), Carnival (CCL +8.20%), and On Holding (ONON +3.10%) look like good deals.
Image source: Target.
1. Target Target has been in the dumps for several years, dealing with issue after issue. Sales and profits have dropped, but there have been many silver linings along the way. The company still has a large store and consumer base, and it demonstrated progress in the 2026 fiscal first quarter (ended May 2). It impressed the market so much that the stock is up 31% this year, well ahead of the S&P 500's 10% gain.
It has a new CEO, and the company is aggressively making changes. It's refreshing its merchandise collection, bringing more technology into its operations, and renovating stores to create an improved shopping experience. Sales increased 6.7% year over year in the first quarter, and comparable sales were up 5.6%. Those are fantastic results for the struggling retailer, but as management acknowledges, it still has a ways to go.
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However, Target is a Dividend King, which means it has raised its dividend for at least 50 years. This coming June will be the 55th consecutive increase, and shareholders can rely on Target for their quarterly check. Target's dividend yields a high 3.6% at the current price.
Target stock trades at 17 times trailing 12-month earnings. The market is still unsure about where the recovery is headed, but it looks priced to buy for long-term or passive income investors as the business recovers.
2. Carnival Carnival continues to demonstrate impressive growth despite headwinds of all kinds, but the market continues to price in all of those headwinds. It trades at a P/E ratio less than 12, which could be a good entry point for long-term investors who can handle volatility.
The results have been strong. In the 2026 fiscal first quarter (ended Feb. 28), revenue increased 6% year over year to a record $6.2 billion. Earnings per share (EPS) were up 50% to $0.19, and it had record net yields, a cruise profitability metric.
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Despite inflation, demand remains robust, and Carnival has its highest-ever booking levels in the first quarter. The booked position for the rest of 2026 is at historical highs for price and occupancy, and bookings for 2027 and beyond are at record highs.
The newest headache for Carnival is soaring oil prices. Cruise companies are highly exposed to oil prices, since it's one of their main costs. Despite this volatility, profitability remains strong, and management explained that operational efficiency is helping to offset the impact of rising costs.
Carnival is the leading cruise company, and over time, Carnival stock should rebound and reward patient investors.
On is a relatively new player in athletic wear. You may recognize the distinctive logo on its products or the distinctive shoe sole on its sneakers. The brand has been catching on as a popular alternative to other premium brands, and it's still rolling out across the globe. It has developed a loyal following of affluent fans that are more resilient under pressure, and the company has a high rate of full-price sales.
That's why, despite inflationary pressure and a retail landscape where many of its peers are struggling, On continues to deliver robust results. In the 2026 first quarter, sales increased 26% year over year (currency-neutral), driven by direct-to-consumer sales growth of 28% and wholesale growth of 25%.
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The company is also incredibly profitable despite rising costs. Gross margin improved from 59.9% to 64.2%, and net income rose 82.2%.
There may be pressure ahead, and the growth rate has decelerated, which is why the stock is down. However, it's already heading higher, and it trades at 42 times trailing 12-month earnings, just off its all-time low.
Baron Focused Growth Fund had a disappointing start to 2026, with a decline of 4.99% (Institutional Shares) compared with a 3.52% loss for the Russell 2500 Growth Index (the Benchmark). Top contributors were Space Exploration Technologies Corp., FIGS, Inc., and Choice Hotels International, Inc. Top detractors were Tesla, Inc., CoStar Group, Inc., and On Holding AG.
On Holding (ONON - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Over the past month, shares of this running-shoe and apparel company have returned +11.6%, compared to the Zacks S&P 500 composite's +6% change. During this period, the Zacks Retail - Apparel and Shoes industry, which On Holding falls in, has gained 4.5%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, On Holding is expected to post earnings of $0.42 per share, indicating a change of +481.8% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The consensus earnings estimate of $1.66 for the current fiscal year indicates a year-over-year change of +71.1%. This estimate has remained unchanged over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $2.1 indicates a change of +26.4% from what On Holding is expected to report a year ago. Over the past month, the estimate has changed +0.5%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #4 (Sell) for On Holding.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
In the case of On Holding, the consensus sales estimate of $1.13 billion for the current quarter points to a year-over-year change of +24.3%. The $4.53 billion and $5.46 billion estimates for the current and next fiscal years indicate changes of +24.5% and +20.5%, respectively.
Last Reported Results and Surprise HistoryOn Holding reported revenues of $1.06 billion in the last reported quarter, representing a year-over-year change of +31.4%. EPS of $0.47 for the same period compares with $0.23 a year ago.
Compared to the Zacks Consensus Estimate of $1.05 billion, the reported revenues represent a surprise of +0.86%. The EPS surprise was +34.29%.
Over the last four quarters, On Holding surpassed consensus EPS estimates three times. The company topped consensus revenue estimates each time over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
On Holding is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about On Holding. However, its Zacks Rank #4 does suggest that it may underperform the broader market in the near term.
On Holding (ONON - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Shares of this running-shoe and apparel company have returned +13.1% over the past month versus the Zacks S&P 500 composite's no change. The Zacks Retail - Apparel and Shoes industry, to which On Holding belongs, has gained 6.8% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, On Holding is expected to post earnings of $0.42 per share, indicating a change of +481.8% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.1% over the last 30 days.
The consensus earnings estimate of $1.71 for the current fiscal year indicates a year-over-year change of +76.3%. This estimate has changed +5.8% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $2.12 indicates a change of +24.2% from what On Holding is expected to report a year ago. Over the past month, the estimate has changed +1.4%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for On Holding.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For On Holding, the consensus sales estimate for the current quarter of $1.13 billion indicates a year-over-year change of +24.3%. For the current and next fiscal years, $4.53 billion and $5.46 billion estimates indicate +24.5% and +20.5% changes, respectively.
Last Reported Results and Surprise HistoryOn Holding reported revenues of $1.06 billion in the last reported quarter, representing a year-over-year change of +31.4%. EPS of $0.47 for the same period compares with $0.23 a year ago.
Compared to the Zacks Consensus Estimate of $1.05 billion, the reported revenues represent a surprise of +0.86%. The EPS surprise was +34.29%.
Over the last four quarters, On Holding surpassed consensus EPS estimates three times. The company topped consensus revenue estimates each time over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
On Holding is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about On Holding. However, its Zacks Rank #3 does suggest that it may perform in line with the broader market in the near term.
