TD Cowen analyst John Kernan maintained a Hold rating on PUMA SE NPV (PMMAF – Research Report) today and set a price target of €22.00.
John Kernan has given his Hold rating due to a combination of factors impacting PUMA SE NPV. The company’s market capitalization has significantly decreased from its peak in 2021, and there is a need for strategic changes in its operating model amidst rising competition and tariffs in the U.S. market. Kernan notes that the company’s focus should shift away from wholesale distribution towards improving Free Cash Flow conversion.
Additionally, PUMA’s recent sales performance has been lackluster, with minimal growth in Q1 and declines in key regions such as the Americas and Asia/Pacific. While there has been some growth in direct-to-consumer and e-commerce channels, the overall gross margin has decreased. The company is in a transitional phase with a new CEO expected to adjust sales and earnings expectations. Furthermore, the anticipated operational investments and high working capital are weighing on Free Cash Flow, prompting a cautious outlook on future earnings.
According to TipRanks, Kernan is a 5-star analyst with an average return of 8.2% and a 52.65% success rate. Kernan covers the Consumer Cyclical sector, focusing on stocks such as Ralph Lauren, TJX Companies, and Columbia Sportswear.
In another report released yesterday, J.P. Morgan also maintained a Hold rating on the stock with a €26.00 price target.