adidas: RBC on hold but raises TP
(CercleFinance.com) - On Friday Royal Bank of Canada raised its target price for adidas shares from 111 euros to 130 euros, while maintaining its sector perform (hold) rating on the stock.
In its morning comments, the Canadian broker considers that the case seems well calibrated at current price levels.
On the one hand, RBC says that it is aware of the arguments favouring the stock - whether the improvement in execution, the quality of its management team or the prospect of improved products and a reorganisation of distribution activities in order to regain market share.
However, the broker also believes that the effects of the ongoing recovery will not materialise until mid-2024 and that the recovery in margins will be slower than the market currently expects.
It also believes that the sports equipment market has become "more competitive" and, with this in mind, it prefers Nike and Puma, on which it has "outperform" ratings.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
In its morning comments, the Canadian broker considers that the case seems well calibrated at current price levels.
On the one hand, RBC says that it is aware of the arguments favouring the stock - whether the improvement in execution, the quality of its management team or the prospect of improved products and a reorganisation of distribution activities in order to regain market share.
However, the broker also believes that the effects of the ongoing recovery will not materialise until mid-2024 and that the recovery in margins will be slower than the market currently expects.
It also believes that the sports equipment market has become "more competitive" and, with this in mind, it prefers Nike and Puma, on which it has "outperform" ratings.
Copyright (c) 2023 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.