12:38 PM EDT, 08/14/2024 (MT Newswires) -- On Holding's ( ONON ) focus on innovation and premium branding is set to drive "industry-leading sales growth and earnings beats," UBS said in a note emailed Wednesday.

The company's "strong" Q2 performance supports UBS' view, the brokerage said.

On reported year-over-year higher Q2 adjusted profit Tuesday of 0.14 Swiss francs ($0.16) per diluted share, on sales of 567.7 million francs.

UBS highlighted key revenue drivers comprising strong new footwear innovation, along with expansion into new sports, new geographies, and new product categories, according to the note.

"These drivers/initiatives should result in increased brand loyalty, relevance, and awareness," ultimately boosting the company's total addressable market and market share, UBS said.

The brokerage cut its full-year 2024 earnings per share estimates for On to 0.80 francs from 0.85 francs due to worse-than-expected [foreign exchange] headwinds and projected higher freight costs for the year.

UBS maintained its $55 price target on the company's stock, with a buy rating.

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