Adidas Gains 5% on Double Upgrade and Pro Partnerships, But Is it Really Time to Buy ADDYY?

Adidas (ADDYY) is running in the right direction Monday morning after getting a double upgrade from Morgan Stanley analysts. A team led by Edouard Aubin moved their position from underweight up two notches to overweight, taking a bullish stance on the athleticwear and shoe brand.

This comes after Aubin and his team noted an uptick in momentum and investor sentiment for the company. Just a few months back in January, things were looking slow and lackluster – but the landscape has shifted.

Now, the demand for Adidas-style shoes has surged, with the chunkier basketball-style shoes falling from grace in favor of “terrace shoes” sold by the various companies under the Adidas umbrella – Samba, Gazelle, and Spezial.

This trend has been communicated by retail stores that are moving the products in droves, particularly here in the US where sales have struggled for the brand recently. Momentum is expected to continue for Adidas hype given the collaboration with Anthony Edwards, who is rolling out his AE1 basketball shoe.

Aubin’s team also noted that CEO Bjørn Gulden played a role in their updated stance. With more than a year and a half of experience under his belt leading the company, he has done a great job segmenting out product lineups for better scale and cost efficiency.

The company is continuing to innovate with new designs and unique twists on existing designs, keeping its foot on the pedal to maintain the trend we’re witnessing in demand.

All of this led to a price target lift from €175 per share to ​​€235. This implies massive upside potential, and the stock is well on its way after climbing 17% over the past 3 months. 

But is it really time to buy ADDYY, or is there any reason to hold out on this opportunity? We’ve taken a look through the VectorVest stock analysis software and found 3 things you need to see.

ADDYY Has Very Poor Upside Potential, But Fair Safety and Very Good Timing

VectorVest simplifies your trading strategy by giving you all the insights you need to make calculated, emotionless decisions in 3 ratings. These are relative value (RV), relative safety (RS), and relative timing (RT).

Each sits on its own scale of 0.00-2.00 with 1.00 being the average, allowing for quick and easy interpretation. You’re even given a clear buy, sell, or hold recommendation for any given stock at any given time based on its overall VST rating. As for ADDYY, here’s what we found:

• Very Poor Upside Potential: The RV rating compares a stock’s long-term price appreciation potential (based on a 3-year price projection), AAA corporate bond rates, and risk. This is a far superior indicator than the typical comparison of price to value alone. ADDYY has a very poor RV rating of 0.47 right now. The stock is overvalued with a current value of just $30.69.
• Fair Safety: The RS rating is a risk indicator. It’s computed through an analysis of the company’s financial consistency & predictability, debt-to-equity ratio, business longevity, sales volume, price volatility, and other factors. The RS rating of 0.93 is fair for ADDYY.
• Very Good Timing: The RT rating is based on the direction, dynamics, and magnitude of a stock’s price movement. It’s calculated day over day, week over week, quarter over quarter, and year over year. The RT rating of 1.31 is very good for ADDYY, reflecting its price trend over the past few months.

The overall VST rating of 1.01 is just above the average and considered fair - but is it enough to justify buying this stock today? Not quite. ADDYY is still considered a HOLD in the VectorVest system. 

That being said, we encourage you to learn more about this opportunity with a free stock analysis today and make your next move with complete clarity and confidence!

Want These Types of Insights at Your Fingertips so You Can Win More Trades?

Use VectorVest to analyze any stock free. VectorVest is the only stock analysis tool and portfolio management system that analyzes, ranks and graphs over 18,000 stocks each day for value, safety, and timing and gives a clear buy, sell or hold rating on every stock, every day.

VectorVest advocates buying safe, undervalued stocks, rising in price. ADDYY got the coveted double upgrade by a team of Morgan Stanley analysts as demand for a variety of its styles surges. The stock itself has very poor upside potential, but it also has fair safety and very good timing.

Before you invest, check VectorVest! Click here to ANALYZE ANY STOCK FREE and see our system in action!