ONON is now overvalued and could go down -46%

Based on our analysis, On Holding AG has received an overvalued rating of 1 out of 5 stars from Cashu. Several key financial ratios indicate that the company's valuation may be excessively high compared to industry standards. The Price-to-Earnings (PE) ratio for On Holding is 63.29, significantly above the sector average of 15.61. A high PE ratio suggests that investors are paying a premium for each dollar of earnings, which could imply overvaluation if earnings growth does not materialize as expected. Additionally, the Price-to-Book (PB) ratio stands at 10.25, compared to the sector average of 1.97. The PB ratio measures the market's valuation relative to the company's book value. A high PB ratio often indicates that the market expects significant growth, but it also raises concerns about sustainability if the anticipated returns do not occur. Furthermore, while On Holding's net profit margin is impressive at 10.44, far exceeding the sector's 0.09, this ratio alone does not justify its high valuation. With a strong return on equity (ROE) of 17.39 and return on assets (ROA) of 10.18, these figures demonstrate efficient use of equity and assets. However, these metrics do not offset the concerns raised by the elevated PE and PB ratios. In summary, the combination of high valuation ratios relative to the sector suggests that On Holding AG may be overvalued at its current price level. This is not a comprehensive overview of our valuation, and should not be viewed as financial advice. Always do your own research before considering an investment.