- Profit Forecast Boost: Adidas has revised its forecast for the fiscal year operating profit to about €1.0 billion, up from a previous estimate of about €700 million.
- Second Quarter Performance: Preliminary results show:
- Gross margin at 50.8%, slightly below the estimate of 51.4%.
- Revenue at €5.82 billion, higher than the estimate of €5.56 billion.
- Yeezy Inventory: The company plans to sell the remaining Yeezy inventory at cost, which will add approximately €150 million in sales for the year but will not contribute to profit.
- Currency Impact: Unfavorable currency effects are significantly affecting Adidas’ profitability, impacting both reported revenues and gross margin development, especially in the first half of 2024.
- Revenue Expectations: Adidas now expects currency-neutral revenues to increase at a high single-digit rate in 2024, up from a previous expectation of a mid- to high-single-digit rate increase.
- Analyst Ratings: The company has received 15 buy recommendations, 14 hold recommendations, and 6 sell recommendations.
A look at adidas Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 2 | |
| Growth | 2 | |
| Resilience | 2 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 2.4 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Analysts using the Smartkarma Smart Scores have evaluated adidas and provided insights into its long-term outlook. With a rating of 4 in Momentum, adidas shows strong potential for growth and positive market performance in the foreseeable future. This high momentum score indicates that adidas has been gaining traction in the market, which could lead to increased profitability and shareholder value over time.
While adidas received a rating of 2 in Value, Dividend, Growth, and Resilience, it indicates a neutral stance across these factors. With a balanced assessment in these areas, adidas may need to focus on improving its performance in various aspects to secure a more positive outlook in the long term.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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