-Ziel Adidas Stock: Hoping to Meet 2024 Target

Last Updated: 8. November 2023By

The Adidas stock is trading about 2 percent lower in the morning trade after the presentation of the final quarterly figures (as of November 8th, around 11am) and is currently among the losers in the DAX. In essence, the company only confirmed the preliminary Q3 figures from October.

The Adidas stock had gained some ground after a weak September with the preliminary figures last month and the raised forecast. Since the beginning of the year, a solid share price increase of more than 30 percent is still on the table. Nevertheless, the situation at Adidas is still somewhat tense. The company is apparently counting on a stronger 2024 after the transition year 2023.

Adidas is making progress in reducing inventories Adidas has confirmed the preliminary figures for the 3rd quarter – sales have dropped by 6 percent to just under 6 billion euros, and the operating margin has fallen from 8.8 percent in the previous year to 6.8 percent. At the same time, the DAX company has confirmed the forecast raised in October, with the minus for the full year expected to be โ€œonlyโ€ 100 million euros.

The focus remains on the very high inventories since the pandemic, which force high discounts. And of course the sale of Yeezy products. The sale of the shoes has been stopped for the time being after two successful waves, and the Yeezy special sale has so far brought in a respectable 750 million euros. In terms of inventories, Adidas has made progress: at 4.8 billion euros, it is 23 percent below the previous year’s level.

Adidas stock: still full inventories – optimism for 2024 Exactly what will happen to the remaining Yeezy shoes has not yet been decided and the further reduction of inventories will not be easy for Adidas without a discount battle. Therefore, the current year 2023 remains a kind of transition year for the DAX company, although the clouds have cleared somewhat since the profit warning at the beginning of the year.

The sports goods giant – like many investors – is counting on a much more successful 2024. Next year, not only should the situation of the warehouses have eased and more sales be made in China, but also major events such as the European Championships in Germany and the Olympic Games in Paris.