12:27 PM EDT, 03/12/2024 (MT Newswires) -- On Holding's ( ONON ) lower-than-expected Q4 sales and 2024 sales guidance that is below expectations are likely to be viewed as a "major disappointment," but the numbers aren't bad in absolute terms, Wedbush said in a report Tuesday.

The company's Q4 net sales grew 22% from a year earlier, which Wedbush said is essentially in line with implied guidance.

"The stock was priced for a higher-growth scenario, so we understand the initial stock reaction," it said. "We don't think anything is 'wrong' here, and when the dust settles, we still think this is the strongest fundamental growth stories in our coverage."

On Holding ( ONON ) shares were down 14% in recent trading following the company's results, which also showed its Q4 swinging to a surprise loss.

"The biggest negative surprise in our view is the slowdown in the Americas, which only grew 29% constant-FX and 19% as-reported" in terms of revenue, Wedbush said. "Asia remained strong at +76% constant-FX, while Europe was +26% constant-FX."

Wedbush has an outperform rating on the stock with a price target of $38.

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