Morgan Stanley resumed coverage of On Holding AG (NYSE: ONON) with an Overweight rating. The bank established a $39.00 price target for the company.
Analysts identify the stock’s 40% year-to-date decline as a significant buying opportunity. The firm suggests the market has excessively discounted the company’s medium-term fundamental strength.
Morgan Stanley expects a higher mix of direct-to-consumer sales and improved cost discipline under new management to drive profitability. The bank believes current consensus estimates underestimate the company's growth durability and margin potential.
On Holding currently stands as Morgan Stanley's only preferred stock within the sportswear sector.