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DTC reached a record 45.7% of Q2 sales, while new launches could help rebuild wholesale momentum.
On Holding AG (ONON - Free Report) has experienced a steep decline over the past three months, with its shares tumbling 30.2%, underperforming the industry’s dip of 17.8%. The company also trailed the Retail - Wholesale sector’s 3.1% decline and the S&P 500 index’s 0.5% rise.
ONON’s Past Three Months’ Performance
Image Source: Zacks Investment Research
On Holding stock has come under pressure as slower sell-through in some everyday running franchises has weighed on the Americas wholesale business. Management has deliberately limited wholesale sell-in to protect channel inventory and full-price positioning, but that decision has reduced near-term sales momentum.
On Holding has also underperformed its peers, including Abercrombie & Fitch Co. (ANF - Free Report) , Urban Outfitters, Inc. (URBN - Free Report) and Genesco Inc. (GCO - Free Report) .
Shares of Abercrombie & Fitch and Urban Outfitters have gained 60.3% and 0.8%, respectively, while Genesco has declined 6.4% over the past three months.
ONON vs. Peer Performances
Image Source: Zacks Investment Research
Closing at $27.15 yesterday, ONON stock stands 46.8% below its 52-week high of $51.08 reached on Jan. 9, 2026. On Holding is trading below its 50- and 200-day simple moving averages of $33.02 and $39.07, respectively, signaling bearish sentiment and making it difficult to maintain recent performance levels.
ONON Trades Below 50- & 200-Day Moving Averages
Image Source: Zacks Investment Research
The share-price decline has not made On Holding inexpensive relative to its industry. ONON stock trades at a trailing 12-month price-to-sales (P/S) ratio of 2.02, above the industry’s average of 1.26.
ONON’s Valuation Picture
Image Source: Zacks Investment Research
This valuation is especially notable when compared with peers such as Abercrombie & Fitch, which has a trailing 12-month P/S of 1.15X, Urban Outfitters at 1.03X and Genesco at 0.15X.
What’s Behind ONON’s Dismal Stock Run?
The main pressure on ONON is the loss of momentum in its Americas wholesale business. Wholesale sales increased only 4.8% on a reported basis in the second quarter of 2026, while reported sales in the Americas rose just 4.5%. Management cited softer sell-through in everyday running products and a heavily promotional multi-brand marketplace, indicating that demand in a key region and channel has fallen short of its expectations.
ONON reduced wholesale sell-in during the second and third quarters to prevent excess channel inventory and markdown pressure. The action lowers near-term revenues and suggests that wholesale demand is not strong enough to absorb the shipment levels previously planned. It also leaves the company more dependent on direct-to-consumer (DTC) growth to offset weakness in wholesale, increasing execution risk during the second half.
The revised full-year outlook points to slower growth. On Holding expects constant-currency sales growth in the low-20% range, implying reported net sales of CHF 3.47 billion to CHF 3.56 billion. Management expects third-quarter growth to be lower than fourth-quarter growth as the remaining wholesale reductions take effect. This back-loaded outlook raises the risk of another disappointment if new-product demand or year-end selling trends fall short.
Geopolitical uncertainty presents an additional risk. On Holding warned that military conflict and continued instability in the Middle East could hurt consumer demand, sales and growth in affected markets. Further disruption to regional trade routes could complicate merchandise movement and weaken discretionary spending, making regional performance more difficult to predict.
ONON’s Downward Estimate Revisions Raise Concerns
The downward revision in earnings estimates has added to investor concerns surrounding the stock. The Zacks Consensus Estimate for earnings per share has moved down over the past 60 days. Estimates for the current quarter have decreased 3 cents to 47 cents per share, while estimates for the next quarter have declined 2 cents to 37 cents.
Image Source: Zacks Investment Research
ONON’s Growth Drivers to Overcome Challenges
On Holding's DTC business remains its strongest growth engine. DTC reached CHF 388.4 million in the second quarter and accounted for a record 45.7% of sales. The channel's growth was broad-based across e-commerce and owned retail, while global brand awareness rose to 30%. A larger DTC mix gives ONON more control over the consumer experience and supports gross margin, although it also requires continued investment in stores, marketing and digital capabilities.
Product innovation offers another avenue for growth. The recently launched Cloudboom Strike 2 expands ONON’s performance-running lineup, while the Cloudsurfer 3, featuring the company’s new SURREAL superfoam, is scheduled to launch through run-specialty partners in October. On Holding is scaling its LightSpray technology across additional core franchises. A steady cadence of differentiated launches could refresh everyday-running demand, attract new customers and help rebuild wholesale momentum heading into 2027.
How to Play ONON Stock: Buy, Hold or Sell?
On Holding continues to benefit from strong DTC growth, expanding margins, a healthy cash position and a pipeline of performance-running innovations. The Cloudboom Strike 2, upcoming Cloudsurfer 3 and broader LightSpray rollout could support demand and help restore wholesale momentum. However, these strengths are being overshadowed by weaker Americas wholesale trends, restrained sell-in, a back-loaded sales outlook and downward earnings estimate revisions. Foreign-exchange pressure, geopolitical uncertainty and the stock’s above-industry valuation add to the near-term risk.
Given these headwinds, the recent share-price decline does not appear to offer a compelling buying opportunity. Existing investors may consider reducing exposure or waiting for wholesale trends and earnings estimates to stabilize, while prospective investors may prefer to remain on the sidelines. On Holding currently carries a Zacks Rank #4 (Sell).
View the Zacks #1 Rank List
Image: Bigstock
On Holding Stock Falls 30% in Three Months: Time to Buy or Stay Away?
Key Takeaways
On Holding AG (ONON - Free Report) has experienced a steep decline over the past three months, with its shares tumbling 30.2%, underperforming the industry’s dip of 17.8%. The company also trailed the Retail - Wholesale sector’s 3.1% decline and the S&P 500 index’s 0.5% rise.
ONON’s Past Three Months’ Performance
Image Source: Zacks Investment Research
On Holding stock has come under pressure as slower sell-through in some everyday running franchises has weighed on the Americas wholesale business. Management has deliberately limited wholesale sell-in to protect channel inventory and full-price positioning, but that decision has reduced near-term sales momentum.
On Holding has also underperformed its peers, including Abercrombie & Fitch Co. (ANF - Free Report) , Urban Outfitters, Inc. (URBN - Free Report) and Genesco Inc. (GCO - Free Report) .
Shares of Abercrombie & Fitch and Urban Outfitters have gained 60.3% and 0.8%, respectively, while Genesco has declined 6.4% over the past three months.
ONON vs. Peer Performances
Image Source: Zacks Investment Research
Closing at $27.15 yesterday, ONON stock stands 46.8% below its 52-week high of $51.08 reached on Jan. 9, 2026. On Holding is trading below its 50- and 200-day simple moving averages of $33.02 and $39.07, respectively, signaling bearish sentiment and making it difficult to maintain recent performance levels.
ONON Trades Below 50- & 200-Day Moving Averages
Image Source: Zacks Investment Research
The share-price decline has not made On Holding inexpensive relative to its industry. ONON stock trades at a trailing 12-month price-to-sales (P/S) ratio of 2.02, above the industry’s average of 1.26.
ONON’s Valuation Picture
Image Source: Zacks Investment Research
This valuation is especially notable when compared with peers such as Abercrombie & Fitch, which has a trailing 12-month P/S of 1.15X, Urban Outfitters at 1.03X and Genesco at 0.15X.
What’s Behind ONON’s Dismal Stock Run?
The main pressure on ONON is the loss of momentum in its Americas wholesale business. Wholesale sales increased only 4.8% on a reported basis in the second quarter of 2026, while reported sales in the Americas rose just 4.5%. Management cited softer sell-through in everyday running products and a heavily promotional multi-brand marketplace, indicating that demand in a key region and channel has fallen short of its expectations.
ONON reduced wholesale sell-in during the second and third quarters to prevent excess channel inventory and markdown pressure. The action lowers near-term revenues and suggests that wholesale demand is not strong enough to absorb the shipment levels previously planned. It also leaves the company more dependent on direct-to-consumer (DTC) growth to offset weakness in wholesale, increasing execution risk during the second half.
The revised full-year outlook points to slower growth. On Holding expects constant-currency sales growth in the low-20% range, implying reported net sales of CHF 3.47 billion to CHF 3.56 billion. Management expects third-quarter growth to be lower than fourth-quarter growth as the remaining wholesale reductions take effect. This back-loaded outlook raises the risk of another disappointment if new-product demand or year-end selling trends fall short.
Geopolitical uncertainty presents an additional risk. On Holding warned that military conflict and continued instability in the Middle East could hurt consumer demand, sales and growth in affected markets. Further disruption to regional trade routes could complicate merchandise movement and weaken discretionary spending, making regional performance more difficult to predict.
ONON’s Downward Estimate Revisions Raise Concerns
The downward revision in earnings estimates has added to investor concerns surrounding the stock. The Zacks Consensus Estimate for earnings per share has moved down over the past 60 days. Estimates for the current quarter have decreased 3 cents to 47 cents per share, while estimates for the next quarter have declined 2 cents to 37 cents.
Image Source: Zacks Investment Research
ONON’s Growth Drivers to Overcome Challenges
On Holding's DTC business remains its strongest growth engine. DTC reached CHF 388.4 million in the second quarter and accounted for a record 45.7% of sales. The channel's growth was broad-based across e-commerce and owned retail, while global brand awareness rose to 30%. A larger DTC mix gives ONON more control over the consumer experience and supports gross margin, although it also requires continued investment in stores, marketing and digital capabilities.
Product innovation offers another avenue for growth. The recently launched Cloudboom Strike 2 expands ONON’s performance-running lineup, while the Cloudsurfer 3, featuring the company’s new SURREAL superfoam, is scheduled to launch through run-specialty partners in October. On Holding is scaling its LightSpray technology across additional core franchises. A steady cadence of differentiated launches could refresh everyday-running demand, attract new customers and help rebuild wholesale momentum heading into 2027.
How to Play ONON Stock: Buy, Hold or Sell?
On Holding continues to benefit from strong DTC growth, expanding margins, a healthy cash position and a pipeline of performance-running innovations. The Cloudboom Strike 2, upcoming Cloudsurfer 3 and broader LightSpray rollout could support demand and help restore wholesale momentum. However, these strengths are being overshadowed by weaker Americas wholesale trends, restrained sell-in, a back-loaded sales outlook and downward earnings estimate revisions. Foreign-exchange pressure, geopolitical uncertainty and the stock’s above-industry valuation add to the near-term risk.
Given these headwinds, the recent share-price decline does not appear to offer a compelling buying opportunity. Existing investors may consider reducing exposure or waiting for wholesale trends and earnings estimates to stabilize, while prospective investors may prefer to remain on the sidelines. On Holding currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.