Adidas convinces investors with strong growth

Investors reacted positively on Thursday to the detailed quarterly figures from Adidas. By midday, the shares topped the firm DAX benchmark index with a gain of nearly 4 percent. For the first time since mid-August, they reached a peak of 165 euros, having fallen below 140 euros at the beginning of October.

Following a recent weaker performance in Europe, the sportswear manufacturer expects a return to growth in the fourth quarter. In a conference call regarding the quarterly figures, chief executive officer Björn Gulden stated that the order book is exceptionally positive. Overall, Adidas anticipates growth in the high single-digit percentage range for the final quarter.

Analyst Piral Dadhania from the Royal Bank of Canada (RBC) investment bank also attested to the sportswear manufacturer's strong, regionally diverse sales growth. With the exception of Europe, all sales regions recorded double-digit percentage growth, thereby exceeding market expectations across the board. Sales were driven by the brand's apparel collection and direct-to-consumer channels. Conversely, wholesale and the footwear division underperformed due to high inventory levels and promotional discounting.

With preliminary figures released last week and a record quarter, Adidas raised its profit forecast. Investors welcomed this news with a share price increase of up to nearly 5 percent. “The preliminary figures lacked detail; today's release makes the operational momentum across distribution channels and regions much clearer,” wrote Robert Krankowski of Union Bank of Switzerland (UBS).

With Thursday's gains, the stock crossed the 200-day exponential moving average, a closely watched trading indicator for longer-term trends. Since the share price slump at the end of July, when Adidas disappointed with its second-quarter report, the stock had been unable to sustainably break through this trendline.