On Holding, the upscale sneaker brand on a hot growth streak, received an analyst downgrade early Wednesday. ONON stock tumbled below a buy point.
Baird analysts downgraded ONON stock, as well as Xponential Fitness, and European Wax Center, to neutral from outperform, citing valuation concerns. The analysts said it is an good time to begin "using strength to further reduce exposure" to the stocks, which have run up lately. They also pointed out that consumer spending at large is on the decline.
On March 21, the Switzerland-based provider of footwear and sports apparel reported nearly doubling fourth-quarter sales, year over year. On Holding also guided "strong results in 2023," including 61% sales growth in the current quarter.
ONON stock, a member of the prestigious IBD Leaderboard, dived 9.7% to 29.35 on the stock market today, moving below its latest buy point.
The shoe stock had gapped up 26% to 27.26 on earnings March 21, clearing a 24.21 cup-with-handle buy point. It quickly hit the 20% profit-taking sell zone, then rose further above it.
On Tuesday, Leaderboard upped its stake in ONON stock as it topped a rare, short stroke alternative buy point at 32.04.
Among other shoe stocks, Dow Jones giant Nike lost 2.3% Wednesday after regaining the 50-day moving average Tuesday. Deckers, which makes the popular Hoka running shoe, dipped 1.3% after hitting a record high Tuesday.
Foot Locker fell 1.3% Wednesday, still below the 50-day line though it's recovering from a March 20 earnings tumble.
On Holding generated a lot of early buzz by signing a deal with retired tennis star Roger Federer.
