ON HOLDING AG-CLASS A (NYSE:ONON) – A Strong Growth Stock with Technical Breakout Potential

ON HOLDING AG-CLASS A (NYSE:ONON) was identified by our screener as a strong growth stock with a favorable technical setup. The company, known for its performance sports products, combines solid financial health with impressive growth metrics while showing signs of a potential breakout. Below, we examine why ONON stands out.

Strong Growth Fundamentals

• Revenue & Earnings Growth: ONON reported a 34.9% year-over-year revenue increase, with earnings per share (EPS) growing by 30.9%. The company’s three-year average revenue growth of 54.1% underscores its rapid expansion.
• Future Expectations: Analysts project continued growth, with EPS expected to rise by 26.2% annually and revenue by 21.4% over the next few years.
• Profitability: Despite a high valuation, ONON maintains strong margins, including a 60.6% gross margin and a 10.5% profit margin, outperforming most peers in the textiles and apparel industry.

Financial Health & Valuation

• Solid Balance Sheet: ONON scores an 8/10 in financial health, with a low debt-to-equity ratio (0.21) and strong liquidity metrics (current ratio of 2.66).
• Expensive but Justified?: The stock trades at a P/E of 48.3, above industry and S&P 500 averages. However, its growth trajectory may support the premium.

Technical Setup

• Recent Performance: ONON has gained 44.3% over the past year, outperforming 87% of the market.
• Consolidation Phase: The stock has been trading between $50.75 and $58.08 recently, with a key resistance zone near $59.61-$60.69. A breakout above this level could signal further upside.
• Support Levels: Strong support exists around $51.47-$53.29, providing a potential stop-loss area for traders.

Our Strong Growth Stocks with Good Technical Setup Ratings screener lists more stocks with similar characteristics.

For a deeper dive, review the full fundamental analysis of ONON and the technical analysis report.

Disclaimer

This is not investment advice. The observations here are based on current data, but market conditions can change. Always conduct your own research before making investment decisions.