Investors weighed slowing demand, margin pressure, and analyst price target cuts.

  • On Holding fell to a two-year low ahead of its Sept. 22 investor day as Williams Trading and Bank of America both lowered their price targets. 
  • Lululemon fell to a seven-year low as weak sales and declining demand weighed on the stock. 
  • PepsiCo is battling weak North American demand, higher costs and restructuring problems. 

On Holding (ONON), Lululemon Athletica (LULU) and PepsiCo (PEP) hit fresh 52-week lows Thursday as investors reassessed growth prospects, demand trends and valuations. Analyst price-target cuts added pressure, while challenges ranging from On’s upcoming investor day to Lululemon’s weak North American sales and PepsiCo’s margin concerns kept sentiment under pressure. 

PepsiCo stock dropped 0.5%, while Lululemon and On Holding pared losses and ended 3% and 0.6% higher, respectively. 

On Holding Faces Investor-Day Pressure

On Holding stock fell to a two-year low of $26.36 ahead of its upcoming investor day on Sept. 22, as analysts reassess the valuation attached to the premium athletic brand. Williams Trading cut its price target to $27 from $32 while maintaining a ‘Hold’ rating, warning that the company's goal of reaching at least CHF 3.55 billion ($4.3 billion) in revenue by fiscal 2026 could be at risk.

Bank of America also trimmed its price target, moving it to $43 from $46 while retaining a ‘Buy’ rating. The firm cited lower valuation multiples among European athletic companies. On Stocktwits, retail sentiment around the stock remained in ‘bullish’ territory. 

Lululemon Struggles With Weak Demand

Lululemon Athletica stock dropped to a seven-year low of $95.35, extending a decline of more than 39% over the past year, even as new CEO Heidi O’Neill begins a reset. Earlier this month, the apparel maker reported second-quarter revenue of $2.42 billion, down 4.3% from a year earlier, while global comparable sales decreased 9% and comparable sales in the Americas fell 12%.

Last week, BMO Capital started covering Lululemon with an Underperform rating and a $70 price target. The firm said the athleticwear company is struggling after years of strong growth, with demand weakening in North America and China and profit margins under pressure. Retail sentiment around the stock remained ‘bearish’. 

PepsiCo Confronts Demand Concerns

PepsiCo stock fell to a 52-week low of $132.93 as concerns about North American demand, commodity expenses, and restructuring continued to weigh on shares. This week, the company announced the closure of a Maryland bottling operation, a move that will affect more than 140 jobs.

PepsiCo has also added Joaquin Duato, chairman and CEO of Johnson & Johnson (JNJ), to its Board of Directors and Audit Committee beginning Dec. 1. Meanwhile, PepsiCo's long record of annual dividend increases remains a notable factor for investors while the market waits for a recovery in beverage and Frito-Lay snack volumes. Retail sentiment around the stock remained ‘bullish’.

So far this year, ONON, LULU and PEP stocks have declined between 6% and 52%. 

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