Adidas Share Rebound Seen as Overdue Correction is Overdone: Jefferies

Adidas shares have fallen 30% since their peak in February due to concerns over the company's reliance on the Terrace shoe and Nike's resurgence. Jefferies believes the post-Q2 correction was overdone, positioning shares for a rebound. The research team led by James Grzinic thinks investors' concerns are overblown and sees Adidas as a solid investment opportunity.

Adidas shares have experienced a significant decline, dropping by 30% from their peak in February. The primary concerns cited for this downturn are the company's heavy reliance on the Terrace shoe and the resurgence of Nike. Jefferies, however, has taken a different stance, suggesting that the post-Q2 correction was overdone and positioning Adidas shares for a potential rebound.

The research team at Jefferies, led by James Grzinic, believes that investors' concerns are overblown. They see Adidas as a solid investment opportunity, despite the recent market fluctuations. The team's analysis indicates that the company's reliance on the Terrace shoe is not as problematic as initially perceived, and the resurgence of Nike may not have as much of an impact on Adidas as feared.

Adidas has been facing challenges in the footwear market, with the Terrace shoe being a significant part of its product portfolio. The company's dependence on this product line has led to concerns about its ability to diversify its revenue streams. Additionally, the resurgence of Nike, a long-standing rival, has put further pressure on Adidas' market position.

Despite these challenges, Jefferies' research suggests that Adidas has the potential to bounce back. The research team points out that the company has a strong brand and a diversified product line, which can help it navigate through market fluctuations. They also note that the recent correction in Adidas' stock price may have been overdone, presenting an opportunity for investors to enter the market at a lower price point.

The research team's bullish outlook on Adidas is supported by the company's financial performance. Adidas reported a 14 cents EPS for the last quarter, exceeding the consensus estimate of 12 cents. The company also announced a quarterly dividend of $0.40 per share, representing an annualized dividend of $1.60 and a dividend yield of 2.1%.

While the current market conditions may present challenges for Adidas, the company's strong fundamentals and the potential for a rebound in stock price make it an attractive investment opportunity. Investors should closely monitor the company's performance and the market's response to its latest earnings report.

References:
[1] https://www.marketbeat.com/instant-alerts/filing-the-manufacturers-life-insurance-company-sells-31222-shares-of-nike-inc-nke-2025-09-01/