ADIDAS AG (ADS.DE) Stock Fundamental Analysis
FRA:ADS - Deutsche Boerse Ag - DE000A1EWWW0 - Common Stock - Currency: EUR
ADS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 40 industry peers in the Textiles, Apparel & Luxury Goods industry. While ADS seems to be doing ok healthwise, there are quite some concerns on its profitability. While showing a medium growth rate, ADS is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
ADS had positive earnings in the past year.
ADS had a positive operating cash flow in the past year.
ADS had positive earnings in 4 of the past 5 years.
ADS had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
With a Return On Assets value of 3.70%, ADS perfoms like the industry average, outperforming 55.00% of the companies in the same industry.
ADS has a Return On Equity of 13.95%. This is comparable to the rest of the industry: ADS outperforms 57.50% of its industry peers.
ADS has a Return On Invested Capital of 8.51%. This is comparable to the rest of the industry: ADS outperforms 50.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ADS is significantly below the industry average of 10.69%.
The last Return On Invested Capital (8.51%) for ADS is above the 3 year average (5.19%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.7% | ||
| ROE | 13.95% | ||
| ROIC | 8.51% |
ROA(3y)2.1%
ROA(5y)3.58%
ROE(3y)8.19%
ROE(5y)11.88%
ROIC(3y)5.19%
ROIC(5y)6.3%
1.3 Margins
Looking at the Profit Margin, with a value of 3.23%, ADS is in line with its industry, outperforming 42.50% of the companies in the same industry.
In the last couple of years the Profit Margin of ADS has declined.
The Operating Margin of ADS (5.65%) is worse than 62.50% of its industry peers.
ADS's Operating Margin has declined in the last couple of years.
ADS has a worse Gross Margin (50.77%) than 65.00% of its industry peers.
ADS's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.65% | ||
| PM (TTM) | 3.23% | ||
| GM | 50.77% |
OM growth 3Y-17.1%
OM growth 5Y-14.1%
PM growth 3Y-31.34%
PM growth 5Y-17.34%
GM growth 3Y0.05%
GM growth 5Y-0.48%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), ADS is creating some value.
Compared to 1 year ago, ADS has about the same amount of shares outstanding.
The number of shares outstanding for ADS has been reduced compared to 5 years ago.
ADS has a better debt/assets ratio than last year.
2.2 Solvency
ADS has an Altman-Z score of 3.24. This indicates that ADS is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.24, ADS is in the better half of the industry, outperforming 65.00% of the companies in the same industry.
The Debt to FCF ratio of ADS is 2.36, which is a good value as it means it would take ADS, 2.36 years of fcf income to pay off all of its debts.
ADS's Debt to FCF ratio of 2.36 is fine compared to the rest of the industry. ADS outperforms 77.50% of its industry peers.
A Debt/Equity ratio of 0.81 indicates that ADS is somewhat dependend on debt financing.
ADS's Debt to Equity ratio of 0.81 is on the low side compared to the rest of the industry. ADS is outperformed by 60.00% of its industry peers.
Although ADS does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 2.36 | ||
| Altman-Z | 3.24 |
ROIC/WACC1.23
WACC6.94%
2.3 Liquidity
A Current Ratio of 1.24 indicates that ADS should not have too much problems paying its short term obligations.
ADS's Current ratio of 1.24 is on the low side compared to the rest of the industry. ADS is outperformed by 72.50% of its industry peers.
A Quick Ratio of 0.72 indicates that ADS may have some problems paying its short term obligations.
The Quick ratio of ADS (0.72) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.72 |
3. Growth
3.1 Past
ADS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 835.08%, which is quite impressive.
The earnings per share for ADS have been decreasing by -15.76% on average. This is quite bad
Looking at the last year, ADS shows a quite strong growth in Revenue. The Revenue has grown by 10.53% in the last year.
Measured over the past years, ADS shows a small growth in Revenue. The Revenue has been growing by 0.04% on average per year.
EPS 1Y (TTM)835.08%
EPS 3Y-17.56%
EPS 5Y-15.76%
EPS Q2Q%17.17%
Revenue 1Y (TTM)10.53%
Revenue growth 3Y3.71%
Revenue growth 5Y0.04%
Sales Q2Q%4.22%
3.2 Future
The Earnings Per Share is expected to grow by 34.20% on average over the next years. This is a very strong growth
Based on estimates for the next years, ADS will show a quite strong growth in Revenue. The Revenue will grow by 8.07% on average per year.
EPS Next Y79%
EPS Next 2Y64%
EPS Next 3Y47.1%
EPS Next 5Y34.2%
Revenue Next Year10.81%
Revenue Next 2Y10.37%
Revenue Next 3Y9.76%
Revenue Next 5Y8.07%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 47.08 indicates a quite expensive valuation of ADS.
Based on the Price/Earnings ratio, ADS is valued a bit more expensive than 62.50% of the companies in the same industry.
When comparing the Price/Earnings ratio of ADS to the average of the S&P500 Index (27.75), we can say ADS is valued expensively.
Based on the Price/Forward Earnings ratio of 18.17, the valuation of ADS can be described as rather expensive.
ADS's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ADS is cheaper than 75.00% of the companies in the same industry.
ADS is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 20.49, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 47.08 | ||
| Fwd PE | 18.17 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ADS is valued a bit more expensive than the industry average as 75.00% of the companies are valued more cheaply.
The rest of the industry has a similar Price/Free Cash Flow ratio as ADS.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.7 | ||
| EV/EBITDA | 14.75 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as ADS's earnings are expected to grow with 47.10% in the coming years.
PEG (NY)0.6
PEG (5Y)N/A
EPS Next 2Y64%
EPS Next 3Y47.1%
5. Dividend
5.1 Amount
ADS has a yearly dividend return of 0.93%, which is pretty low.
The stock price of ADS dropped by -20.87% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 3.55, ADS is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.44, ADS's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.93% |
5.2 History
The dividend of ADS decreases each year by -26.93%.
Dividend Growth(5Y)-26.93%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
ADS pays out 16.36% of its income as dividend. This is a sustainable payout ratio.
DP16.36%
EPS Next 2Y64%
EPS Next 3Y47.1%
FRA:ADS (5/2/2025, 5:36:15 PM)
206.7
+5 (+2.48%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Durables & Apparel
GICS IndustryTextiles, Apparel & Luxury Goods
Earnings (Last)
Earnings (Next)
Inst Owners51.74%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap37.21B
Analysts74.86
Price Target262.87 (27.17%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.93% |
Yearly Dividend0.7
Dividend Growth(5Y)-26.93%
DP16.36%
Div Incr Years0
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)21.07%
Min EPS beat(2)5.82%
Max EPS beat(2)36.32%
EPS beat(4)3
Avg EPS beat(4)10.36%
Min EPS beat(4)-21.15%
Max EPS beat(4)36.32%
EPS beat(8)5
Avg EPS beat(8)17.3%
EPS beat(12)8
Avg EPS beat(12)7.03%
EPS beat(16)11
Avg EPS beat(16)11.48%
Revenue beat(2)1
Avg Revenue beat(2)0.86%
Min Revenue beat(2)-0.91%
Max Revenue beat(2)2.63%
Revenue beat(4)2
Avg Revenue beat(4)0.23%
Min Revenue beat(4)-1.03%
Max Revenue beat(4)2.63%
Revenue beat(8)5
Avg Revenue beat(8)0.64%
Revenue beat(12)6
Avg Revenue beat(12)0%
Revenue beat(16)8
Avg Revenue beat(16)-0.01%
PT rev (1m)-2.72%
PT rev (3m)2.9%
EPS NQ rev (1m)0.01%
EPS NQ rev (3m)2.66%
EPS NY rev (1m)-1.38%
EPS NY rev (3m)1.52%
Revenue NQ rev (1m)-0.81%
Revenue NQ rev (3m)1.77%
Revenue NY rev (1m)0.54%
Revenue NY rev (3m)2.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 47.08 | ||
| Fwd PE | 18.17 | ||
| P/S | 1.57 | ||
| P/FCF | 15.7 | ||
| P/OCF | 12.79 | ||
| P/B | 6.8 | ||
| P/tB | 9.86 | ||
| EV/EBITDA | 14.75 |
EPS(TTM)4.39
EY2.12%
EPS(NY)11.38
Fwd EY5.5%
FCF(TTM)13.17
FCFY6.37%
OCF(TTM)16.17
OCFY7.82%
SpS131.57
BVpS30.42
TBVpS20.97
PEG (NY)0.6
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.7% | ||
| ROE | 13.95% | ||
| ROCE | 12.09% | ||
| ROIC | 8.51% | ||
| ROICexc | 12.29% | ||
| ROICexgc | 15.8% | ||
| OM | 5.65% | ||
| PM (TTM) | 3.23% | ||
| GM | 50.77% | ||
| FCFM | 10.01% |
ROA(3y)2.1%
ROA(5y)3.58%
ROE(3y)8.19%
ROE(5y)11.88%
ROIC(3y)5.19%
ROIC(5y)6.3%
ROICexc(3y)6.53%
ROICexc(5y)8.63%
ROICexgc(3y)8.14%
ROICexgc(5y)10.85%
ROCE(3y)7.37%
ROCE(5y)8.95%
ROICexcg growth 3Y-9.6%
ROICexcg growth 5Y-13.31%
ROICexc growth 3Y-10.88%
ROICexc growth 5Y-12.05%
OM growth 3Y-17.1%
OM growth 5Y-14.1%
PM growth 3Y-31.34%
PM growth 5Y-17.34%
GM growth 3Y0.05%
GM growth 5Y-0.48%
F-Score8
Asset Turnover1.15
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 2.36 | ||
| Debt/EBITDA | 1.73 | ||
| Cap/Depr | 44.7% | ||
| Cap/Sales | 2.28% | ||
| Interest Coverage | 6.16 | ||
| Cash Conversion | 114.34% | ||
| Profit Quality | 310.21% | ||
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.72 | ||
| Altman-Z | 3.24 |
F-Score8
WACC6.94%
ROIC/WACC1.23
Cap/Depr(3y)45.61%
Cap/Depr(5y)45.44%
Cap/Sales(3y)2.57%
Cap/Sales(5y)2.65%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)835.08%
EPS 3Y-17.56%
EPS 5Y-15.76%
EPS Q2Q%17.17%
EPS Next Y79%
EPS Next 2Y64%
EPS Next 3Y47.1%
EPS Next 5Y34.2%
Revenue 1Y (TTM)10.53%
Revenue growth 3Y3.71%
Revenue growth 5Y0.04%
Sales Q2Q%4.22%
Revenue Next Year10.81%
Revenue Next 2Y10.37%
Revenue Next 3Y9.76%
Revenue Next 5Y8.07%
EBIT growth 1Y398.88%
EBIT growth 3Y-14.03%
EBIT growth 5Y-14.07%
EBIT Next Year157.09%
EBIT Next 3Y54.32%
EBIT Next 5Y35.3%
FCF growth 1Y15.95%
FCF growth 3Y-2.1%
FCF growth 5Y2.35%
OCF growth 1Y14.21%
OCF growth 3Y-3.05%
OCF growth 5Y0.64%