ADS.DE Stock Today: January 07 — BofA Double Downgrade Hits Shares
Adidas stock fell on January 07 after a Bank of America downgrade to Underperform with a €160 target, citing fading athleisure and post-World Cup demand risks. Adidas stock (ADS.DE) traded between €165.95 and €171.30, near its 12‑month low of €150.40, while the DAX index showed relative resilience. Volume topped average as investors reassessed growth and margins. We break down the move, key technical levels, and what could drive the next leg for the Adidas share price in the coming weeks.
BofA call and sector backdrop
Bank of America cut the shares two notches to Underperform and set a €160 price target, pointing to a cooling athleisure cycle and softer demand after major football events. German media highlighted the steep reaction and the shift in sentiment around premium sportswear demand source. Analysts also flagged risk that consumers trade down if pricing power fades, pressuring mix and margins.
Coverage noted rising volatility across global peers like Puma and Nike as investors rethink a 20‑year trend toward athleisure wear source. While the DAX index showed steadier tone, Adidas stock underperformed as debates on category growth and inventory linger. The market now seeks clearer signs on wholesale sell-through and pricing discipline into spring collections.
Price action and technical picture
Adidas stock last traded at €170.45 (open €168.95), with today’s range at €165.95–€171.30. Volume reached 558,052 versus a 515,642 average. Momentum stayed fragile: RSI sits at 45.64 and CCI at −218.03, an oversold read that often marks short-term exhaustion, not a guarantee of reversal. The Adidas share price hovered near the lower end of recent bands.
Price sits above the 50-day average (€162.84) but below the 200-day (€186.62). Bollinger levels cluster around €165.21 (middle) and €171.17 (upper), with the lower band near €159.25. ATR is 4.66, and ADX at 16 signals no clear trend. For traders, sustained closes above €171–€172 may ease pressure, while slips toward €165 would keep sellers active.
Fundamentals and valuation check
At €170.45, the shares trade near 24x TTM EPS of €6.78 and 5.13x book. EV/EBITDA is 10.94, price-to-sales 1.18x, and dividend yield about 1.22%. Adidas stock also carries high cash-flow multiples (P/OCF ~32x, P/FCF ~77x), showing limited room for execution misses while the cycle and pricing power are under review.
Gross margin stands at 51.36% and operating margin at 7.89%. ROE is 22.08% with interest coverage of 8.94 and debt-to-equity near 0.95. Inventory days are 166, a watch point for 2025 sell-through. For 2024, EPS grew about 11.19% and operating cash flow rose 14.12%, signaling progress, but the durability of these gains is now central to the debate.
What could move the shares next
Investors will watch order books, pricing, and wholesale cancellations into spring/summer drops. Any clarity on China momentum, football event normalization, and markdown plans could steady the Adidas share price. Management commentary on channel inventory and outlet mix will be key to margins. Next earnings are scheduled for March 4, 2026.
If margins and sell-through beat expectations, a re-rate toward mid-€170s to €180s is possible, while weak demand could refocus markets on the €160 target. Keep an eye on euro moves, DAX index flows, and peer results for read-across. Adidas stock remains sensitive to fashion cycle headlines and promotional intensity.
Final Thoughts
The Bank of America downgrade resets expectations at a €160 target and shifts focus to demand quality, pricing, and inventory. Adidas stock trades between key technical markers, with RSI and CCI signaling fragile momentum. Valuation is not low versus cash flows, so execution must stay firm. We think German investors should track sell-through data, markdown trends, and China updates ahead of the March 4, 2026 print. For active traders, €165–€172 is the near-term range to watch. For long-term holders, margin cadence and working capital discipline will likely drive the next move in the Adidas share price.
FAQs
Why did Adidas stock drop today?
Adidas stock fell after a Bank of America downgrade to Underperform, with a new €160 target. The note cited fading athleisure tailwinds and possible post-World Cup demand softness. That raised concern about pricing power and margins. The reaction was sharper than the broader DAX index, as investors questioned the near-term growth path.
What is the new price target after the Bank of America downgrade?
Bank of America set a €160 price target alongside an Underperform rating. The cut reflects worries about category growth, consumer trade-down risk, and potential markdowns. The target sits below recent trading levels, so investors will look for evidence in orders, sell-through, and margins to challenge or confirm that view.
Is Adidas stock undervalued after the selloff?
Not necessarily. The shares still trade near 24x trailing earnings and roughly 77x free cash flow. That is a full multiple for a company facing cyclical questions. If margins stabilize and inventory improves, valuation could look more attractive, but near-term proof on pricing and demand would help close the gap.
What key dates should investors watch for Adidas?
The next major date is the earnings release scheduled for March 4, 2026. Before then, watch channel checks on spring/summer collections, any guidance updates, and peer results for signals on demand and markdowns. These updates can affect the Adidas share price ahead of the official report.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
