Adidas saw a significant uptick in its shares on Wednesday, climbing as much as 5% to reach their highest level in over two years. This surge came after the German sportswear giant raised its full-year guidance for the second time in 2024, surpassing expectations with robust second-quarter results announced on Tuesday.
Analysts at Telsey Advisory Group highlighted that the strength in the second quarter of 2024 was largely driven by Adidas’ terrace Originals franchises, specifically the Samba and Gazelle lines, which have been gaining popularity among US consumers.
The analysts expressed optimism that this momentum could carry forward through the latter half of the year and into 2025, buoyed in part by softened demand in recent months for some of Nike’s key lifestyle franchises, such as Air Force 1 and Air Jordan 1.
Adidas’ success was anticipated due to the strong demand for its low-rise multi-colored ‘terrace’ sneakers, coupled with weaker sales at competitor Nike. Observers had expected this trend to bolster Adidas’ performance in the second quarter.
Looking ahead, Simon Irwin, retail and sporting goods analyst at Tanyard Advisory, raised questions about Adidas’ ability to sustain this momentum. He noted that while the current focus remains on ‘terrace’ sneakers, Adidas must also strategize for future trends like ‘retro running’ and ‘low profile’ lines.
By 08:15 GMT, Adidas shares were trading at 239 euros, marking their most significant one-day increase in three months and reflecting a 30% gain year-to-date. Meanwhile, rival Puma also saw a rise, climbing as much as 2.8%.
Investors and analysts are now considering whether Adidas stock (ADDYY) remains a strong buy amidst its recent performance and outlook upgrades.
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